Based on the latest data released by manufacturers as reported by cvworld.cn, a total of 82,000 heavy-duty trucks were sold in January, surging 122 percent from a year earlier and 9 percent from last December. It also marks the highest sales tally in January in the latest six years. The previous historical high for January happened in 2011.
Multiple factors contribute to sales explosion
Strong growth was expected for January but not at such a high rate. Thanks to such factors as implementation of the Action Plan of Controlling Oversize and Overloading for Highway Trucks since October 2016 and inventory replenishment of coal market, new heavy-duty truck sales climbed sharply and there was even supply shortage of key parts including axles. In Q4 2016, heavy-duty truck sale totaled 236,800 units, adding 68 percent on a yearly basis.
Therefore, rapid growth in January was essentially an extension of market characteristics of Q4 2016. In October, sales rose to a historical high of 69,600 units for that month over the latest six years, driven by implementation of the GB1589-2016 and policies of controlling oversizing and overloading. In November, sales hit another record high of 92,000 units, which almost double those of a year earlier, due to a structural shortage of highway transport capacity. In December, sales were “only” 75,300 units, as some of the mainstream enterprises “saved” sales for January, fueling growth for the month.
Actually, manufacturing PMI has also maintained its expansionary state for several consecutive months when heavy-duty truck sales witnessed rapid increase, indicating growth of heavy-duty truck market was supported by real demand. Since October 2016, manufacturing PMI has been standing above 51; even in January with Chinese New Year, it reached 51.3, rarely seen since 2012.
Driven by FAW Jiefang, Q1 to see net increase of 100,000 units in sales
All mainstream heavy-duty truck manufacturers benefited from growth. FAW Jiefang remained No. 1 with sales of 23,000 heavy-duty trucks, tripling to seize a market share of 28 percent. Dongfeng remained as the runner up by selling 14,000 units, jumping 37 percent. Shaanxi Auto rose to third spot with sales of 12,000 units, up 143 percent. CNHTC and Foton followed with sales of 11,000 and 7,000 units, respectively, up 80 and 44 percent.
JAC and Dayun seized the sixth and seventh spots by selling 6,007 and 2,520 units, up 159 and 124 percent, with a market share of 7.3 and 3.1 percent, respectively. SAIC-IVECO-Hongyan sales surged 123 percent to 1,807 units, seizing a market share of 2.2 percent, while CAMC Hualing and Beiben each sold 1,139 and 1,000 units, expanding 109 percent and more than 5 times, respectively. Generally speaking, competitive pattern of the market was not stable and we will have a better idea of the rankings after Q1.
Sound performance in the beginning of 2017 also laid solid foundation for significant growth in Q1. Based on this, accumulated sales of 240,000 units in Q1 are very possible, which means a net addition of over 100,000 units. That will mean a year-on-year explosion of 71 percent in Q1!
(Rewritten by Xu Jun based on author’s article on cvworld.cn)