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Technavio’s market research analyst predicts the passenger vehicle market in China to grow at a CAGR of more than 5% by 2020. China is one of the fastest-growing auto industries and accounts for a major presence of original equipment manufacturers (OEMs) across the globe. Passenger cars are a key segment of the Chinese automotive industry, constituting more than 80% of the total automotive industry. Factors such as increasing disposable income, rapid urbanization, demand for new cars from lower tier cities, and low vehicle costs are driving the growth of passenger vehicles in China. The market is also expected to witness rapid sales of electric and hybrid cars during the forecast period due to the reduced cost of batteries used in these vehicles.
Owing to the presence of a well-established e-commerce chain and the growing preference for buying merchandise through online platforms, several automotive manufacturers are making their products available online. With more people willing to buy cars online, the OEMs and dealers are selling new cars online through various e-business platforms such as Alibaba, Autobytel, and AutoNation. Automotive OEMs in China are expected to focus on the online retail channels in the coming years as these channels will help the OEMs to maintain a direct relationship with buyers.
By 2020, the electric and hybrid vehicle segment will be the fastest growing segment of the market and is expected to grow at a CAGR of more than 23%. The sales of electric and hybrid vehicles will increase significantly owing to government-sponsored cash subsidies, the expansion of EV infrastructure development, and declining prices of vehicle batteries. Factors such as stringent emission norms, fluctuating fuel prices, and the growing demand from customers for eco-friendly transportation are expected to drive the growth of this segment during the forecast period.
The sedans and small cars segment dominated the passenger vehicle market in China in 2015 and occupied around 52% of the overall market share. Much of this segment’s growth can be attributed to economic slowdown ad government-sponsored subsidies for these vehicles. Rising demand for sedans in Tier three, four, and five cities and the introduction of small cars at low prices will contribute to the growth of this segment in the coming years.
This market is extremely fragmented with the presence of many foreign and domestic players. It is primarily dominated by key players who collectively account for more than 62% of the total market share. Being the biggest market for passenger cars, several global OEMs are entering the Chinese market owing to the high market demand. Moreover, the regional players are offering products at low prices to acquire more market shares and to increase their profit margins.
The leading vendors in the market are -
Other prominent vendors in the passenger vehicle market in China are Brilliance Auto, BYD Auto, Chery, GAC (Guangzhou Automobile Corp.), GM China, Great Wall, and Volkswagen China.
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PART 01: Executive summary
PART 02: Scope of the report
PART 03: Market research methodology
PART 04: Introduction
PART 05: Value chain
PART 06: Market landscape
PART 07: Market segmentation by propulsion type
PART 08: Market segmentation by vehicle type
PART 09: Market drivers
PART 10: Impact of drivers
PART 11: Market challenges
PART 12: Impact of drivers and challenges
PART 13: Market trends
PART 14: Vendor landscape
PART 15: Key vendor analysis
PART 16: Appendix
PART 17: Explore Technavio
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