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China’s auto market still full of potential despite first decline in 28 years

(People's Daily Online)    14:09, January 10, 2019

A production line in the Chang'an Automobile Group. (Chongqing Daily/Luo Bin)

In 2018, China sold a total of 27.8 million vehicles, 1 million less than the previous year. However, the industry is still full of promise, as the country implements further measures to boost this figure, said Ning Jizhe, deputy chairman of China’s National Development and Reform Commission, in a recent interview.

Although China’s auto market recorded its first slump in 28 years, it still accounted for 30 percent of the global market share.

Ning disclosed that China would implement measures to further facilitate the consumption of hot-spot commodities including cars and home appliances.

He noted that while China’s average annual auto sales figure is now approaching 30 million, the country still holds further market potential.

The previous rapid growth of auto sales, the downfall of macroeconomic growth, the cancellation of preferential purchase tax, as well as the stable housing market in central and western China all bring pressure to the continuous growth of vehicle sales in 2019, said Cui Dongshu, secretary-general of the China Passenger Car Association.

Shi Jianhua, deputy secretary general of the China Association of Automobile Manufacturers, described the recent slump as normal, considering the steady development of the auto market and the average sales growth of automobiles over recent years.

Insiders believe that compared with the slowing growth of the urban auto market, China’s rural regions are gradually emerging as an important arena for the auto industry's future. Thanks to the growing income of rural residents and the improving infrastructure in rural areas, these regions are expected to see an increasing appetite for auto consumption.

In spite of the general optimism surrounding China’s auto market, the sales volume of vehicles in the country is not likely to return to its former glory in the short-term.

It's likely that China will maintain a low-speed growth in the auto market, said Song Zifeng, director of the Research Department of Industrial Economy under the Development Research Center of the State Council. 

(For the latest China news, Please follow People's Daily on Twitter and Facebook)(Web editor: Hongyu, Bianji)

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