inside china’s auto market - university of · pdf filesue yingzi su senior economist,...
TRANSCRIPT
¶ Growth in Chinese auto industry surprised most experts
¶ Having reached 20+ million units in annual sales, China auto industry still has great potential – Low vehicle ownership density
– Room for growth in smaller cities
¶ Yet, pace of auto sales will be slower than before– Slower growth in Chinese economy
– Restrictions on auto purchases and uses
– Rising costs of owning and operating a vehicle
INTRODUCTION
It has been a spectacular run
13.7
18.3 18.719.4
51%
34%
2% 4%
-
5
10
15
20
25
-10%
0%
10%
20%
30%
40%
50%
60%1
99
1
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
20
10
20
11
20
12
20
13
Tho
usa
nd
s
Growth of China Auto IndustryGrowth %
Volume (Mil.)
Average growth rate 1991-2008: 17%
WTO
China vehicle sales v.s. the World
0
5,000
10,000
15,000
20,000
25,000
30,000
1985 1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013
Vehicle Sales by Region
China Total Europe North America Other Markets
Growth in vehicle sales returned to double digit in 2013
-
500
1,000
1,500
2,000
2,500
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Tho
usa
nd
s
2013 2012 2011 2010 2009 2008
China Industry Monthly Volume
Real GDP growth is slowing
9.89.5
9.28.9
8.17.6
7.4
7.97.7
7.5
7.8
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2011 2012 2013
Trend of GDP Growth
Rebalancing Chinese economy will have profound impact
49.5%
47.8%
2.8%
36.0%
-20%
0%
20%
40%
60%
80%
100%
78 80 82 84 86 88 90 92 94 96 98 00 02 04 06 08 10 12Consumption Investment Net Exports Household Consumption
Major Components of China GDP2012
Great potential remains for China
8
0
10
20
30
40
50
0 3,000 6,000 9,000 12,000 15,000 18,000
Ne
w V
eh
icle
Sa
les
Pe
r 1
,00
0 P
eo
ple
GDP Per Capita (2012 EKS$)
1990-2012China
1988-1999Korea
1984-1994Taiwan
1965-1976Japan
Country 2012 Car Parc/1,000 People
U.S. 813
Australia 693
Japan 585
Korea 385
Russia 308
Taiwan 306
Thailand 193
Brazil 187
China 81
Egypt 36
India 24
Source: Conference Board Total Economy Database, GM calculation
Challenges in China – aging population
9
0
5
10
15
20
25
30
35
40
45
0
200
400
600
800
1000
1200
19
50
19
53
19
56
19
59
19
62
19
65
19
68
19
71
19
74
19
77
19
80
19
83
19
86
19
89
19
92
19
95
19
98
20
01
20
04
20
07
20
10
20
13
20
16
20
19
20
22
20
25
20
28
Million
Median Age Working Age Population 15-64
Source: United Nations
Age
More cities will restrict vehicle purchase after Beijing, Shanghai, Guangzhou and Guiyang
城市 青岛 天津 重庆 武汉 深圳 石家庄 成都 杭州 全国
2009 57% 36% 62% 54% 20% 58% 77% 65% 56%
2010 21% 18% 30% 25% 28% 28% 13% 38% 26%
2011 14% 8% 17% 12% 4% 11% -2% -2% 4%
2012 7% 10% 24% 10% 12% 17% 6% 8% 16%
2013.1-8 21% 30% 22% 33% 31% 21% 21% 24% 16%
Growth rate of vehicle sales in cities that could restrict purchases
City
Source: China State Information Center
Qing Dao
Tian Jin Chong Qing
Wu Han ShenZhen
Shi jiaZhuang
Cheng Du
Hang Zhou
Nation
Rising cost of owning a vehicle - Shanghai license plate auction price topped RMB80,000 ($14,000) in October
-
20,000
40,000
60,000
80,000
100,000
1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9 11 1 3 5 7 9
2010 2011 2012 2013
Yuan
Motivations to trade up
14
110.8%
86.9%
11.2%
24.9% 19.4%
59.4%
31.7% 47.5%
85.7%
25.9%
17.9%
35.6%
62.9% 65.6%
13.8%
26.1%29.5%
23.7%
7.3%
51.4%
37.4%
8.8%6.8%
13.7%
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
SUV Growth Rate
Passenger Vehicle Growth Rate
Chinese Passenger Vehicle Market
80% PV is just 4 Segments. PV is global brand dominated (73%)
Car C is the largest segment, with
over 5 million units sold in 2012, the
size of total industry of Japan
0
4,000
8,000
12,000
16,000
2000
200
1
200
2
200
3
200
4
2005
200
6
200
7
200
8
200
9
201
0
201
1
2012
Ind
us
try V
olu
me
(00
0 u
nit
s)
Global Brands
Local Brands
20%
68%
30%78%
73%
26%
It is a fragmented market
2012 Total China Industry (incl. CVs)~ 19.4 million units
w/ 30+ local OEM groups supported by
provincial/municipal Government
Veh Type 2012
1 Wuling Sunshine CV 522,933
2 Wuling Rong Guang CV 466,428
3 BJ 10 Series CV 429,035
4 Changan Star Light CV 325,554
5 Wuling CN100 PV 316,235
6 Ford Focus PV 296,360
7 Hyundai Elantra PV 279,121
8 Buick Excelle PV 277,071
9 Toyota Corolla PV 276,418
10 VW Lavida PV 246,687
Model Name
Top 10 Vehicles in 2012
Changan Star
9
4
10
BJ 10 SERIES
Hyundai New Elantra
Source: China Sales
3
Toyota Corolla
7
6
VW LavidaBuick Excelle
Wuling RongguangWuling Sunshine
Volume
Wuling CN100 Ford Focus
1 2
5
8
Top 10 Passenger Cars in 2012
Hyundai Elantra
VW LavidaBuick Excelle
VW New BoraVW Jetta
Toyota Corolla
3
1
4
2
65
7
8
9
10
Chevrolet Cruze
2012
1 GM CN100 316,235
2 Ford Focus 296,360
3 Hyundai Elantra 279,121
4 GM Excelle 277,071
5 Toyota Corolla 276,418
6 VW Lavida 246,687
7 VW Jetta 242,528
8 GM Cruze 232,592
9 VW Bora 222,735
10 GM Sail 218,090
Model Name
Wuling CN100 Ford Focus
GM Sail
GM’s Footprint in China
Shanghai (SGM/ PATAC)
Shenyang (SGM)
Liuzhou (SGMW)
Yantai (SGM)
Qingdao (SGMW)
HK Office
Beijing Office
China/IO Office
Changchun (FGL)
Ha’erbing (FGL)
Qujing (FGL)
Shanghai OnStar
GM China 2012/13 Passenger Cars
ATS CTS SLS SRX Escalade
Excelle NB/SW New Excelle HB/NB Enclave Regal LaCrosse
First Land GL8 Park Avenue CN100 MPV-B Encore
Astra Astra GTC Astra Twin-Top Zafira Antara
Spark Captiva Aveo/Lova Sail NB/HB Epica Cruze Malibu
¶ China economy is slowing as Chinese government pursues more sustainable growth
¶ Auto sales will grow at a slower pace following restrictions on owning and operating vehicles
¶ But, demand for vehicles in China remains very strong and market potential remains huge
SUMMARY