Shanghai Auto Showcase 2015: China’s fattest auto demonstrate inaugurates in the midst of growth slowdown
“The market will increase less than in former years, but still much higher than in any other relevant automotive market in the world,” President and CEO of Volkswagen Group China, Jochem Heizmann, told reporters on the eve of the display. “It’s still a tremendous market,” he said. Vehicle sales in China reached 23.49 million last year, well ahead of the United States, which it overtook in 2009. But annual sales growth halved to 6.9 per cent last year from 13.9 per cent in 2013, according to the China Association of Automobile Manufacturers (CAAM).
The slowdown continued in the very first three months of this year, when sales rose just Three.9 percent. At the demonstrate, a rumoured ban on scantily clad models appeared to be in effect, as car makers used demurely dressed attendants and dance shows to draw attention to their stands at a sprawling fresh venue. Among the bright catches sight of in China is the market for SUVs (sport utility vehicles), one of the country’s fastest growing segments. “By 2018, China is expected to be the fattest market in the world for SUVs,” John Lawler, Chairman and CEO of Ford Motor China, told a news conference on Monday.
Ford is introducing seven fresh vehicles in Shanghai, including two SUVs and the Taurus, intended to be its flagship sedan for the China market. But the “premier” car segment – which sells for USD 33,000 to USD 197,000 – and the even more pricey luxury market have been slammed by the economic slowdown as well as a more than two-year campaign to crack down on corruption and government waste.
“There’s an influence from a cultural standpoint about demonstrating off your wealth in China right now,” said Luca de Meo, member of the board of management for sales and marketing at Germany’s Audi. “It could have an influence on the automotive business and we’re witnessing it already in the high-end segment. There are less government-related purchases as well,” he said.
Supported by Chinese government backing, auto makers are making a renewed thrust for fresh energy vehicles, displaying the latest fully-electric models and hybrids at the display. Volkwagen announced plans to locally produce more than fifteen fresh energy vehicles in China in the next four years, while General Motors will launch a plug-in hybrid version of its Cadillac brand CT6 sedan.
But the Chinese market for electrical cars remains petite with consumers reluctant owing to perceived problems with reliability and access to charging facilities. Electrical and hybrid vehicle sales in the country reached 26,581 in the very first quarter of this year, three times the same period in two thousand fourteen but still accounting for less than one percent of total sales, according to the CAAM.
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