Auto Industry in China Facing Sluggish Market
    2012-06-14 09:06:46     CRIENGLISH.com         Web Editor: Mao

Even though a turnaround in the industry is expected later this year here in China, both domestic and international auto manufacturers are struggling to find sales, despite moves recently to slash prices.

CRI's Liu Min has more.

Beijing Yayuncun Auto Trading Market, the largest automobile trading center in Asia used to see customers flocking in to bargain with dealers. But the downturn has been going on for a while now. Dealership managers from both Chinese and foreign auto companies say they've provided huge discounts to compete for a limited number of customers.

A dealership manager selling domestic brand cars gives his opinion.

"We've cut one to three thousand yuan in prices. It's not just us. Some imported cars are losing money as they have a larger stock of vehicles."

Higher end cars such as Benz, BMW, and Audi used to put prices up during peak season, but now they've totally given up on the idea. Manager Zhang Xiaojun from FAW-Audi says they are expecting to see fiercer competition among auto manufacturers this year. 

"The production capacity of higher-end cars is quite powerful, so their competition is quite tense. This situation will continue for quite some time, which forces us to reduce prices."

China has seen rapid growth in the auto industry in recent years with the largest consumer market in the world. However, since last year, sales volume has shown a downward trend.

Not just first-tier cities like Beijing Shanghai and Guangzhou, but also second and third tier cities in inland China have seen droping sales. Dong Yang, the Executive Vice President of the China Auto Industry Association echoes the report.

"If we look at the whole market over time, then the situation at the beginning of this year was quite tense. But the trend was a bit better when it came to March and April. If we look at it based on types of vehicles, then passenger cars and sedan cars are selling better. But types like freight vehicles and specialized vehicles for construction have seen sharp drops in sales."

Dong Yang predicts that it will be hard to achieve rapid development in the industry similar to the previous years but remains optimistic about the future.

"Some people in the industry predict that the Chinese auto industry will see a disastrous situation very soon, but our estimation is the opposite. Auto manufacturers, especially domestic brands, need to think about how to have sustainable development, for example, how to improve their product quality, cultivate new models, and control cost. This would be good for restructuring and upgrading their enterprises."

Auto industry experts point out that China has entered an era of fierce competition between domestic and foreign brands. The point of contention is price versus brand, with reputation winning out. Manager Wu Xinfa from Dongfeng Yulong Auto Company says they've found their way to compete.

"Our focus is our product, a car that can provide a better experience, more special than other cars. Personalized services and the driving experience should be a new sales point."

For those who want to purchase a car this year, car dealers say that prices may also see a further drop in the upcoming months since auto manufacturers are promoting their new models, trying to sell their old stock as soon as possible.

For CRI, I'm Liu Min.

Share

                  


CRIENGLISH.com claims the copyright of all material and information produced originally by our staff.

CRIENGLISH.com holds neither liability nor responsibility for materials attributed to any other source. Such information is provided as reportage and dissemination of information but does not necessarily reflect the opinion of or endorsement by CRI.


 
Hourly News more

The Beijing Hour more
The Beijing Hour updated 20:00 2014/05/23
Micro-blog: weibo.com/beijinghour

Highlights more

People In The Know more
2014-01-20 20 Years of NAFTA and the Future of Free Trade
Twenty years on, how should we look back on NAFTA and its achievements?
2013-12-26 Big Data and Cloud Computing (2)
What role can big data play in the world of finance, and the regulation of that role?

Talk to CRI

News
China
World
Politics
Business
Sports
Showbiz
Sci-tech
Photo
Recommended
China
World
Sports
Showbiz
Travel
Video
C4
The Sound Stage
Showbiz
Travel
China Revealed
My Chinese Life
Travel
Destinations
Photo Gallery
Recommended
Learn Chinese
"In" Chinese
Chatting in Chinese
Pop Culture
Traditional Culture
Living Chinese
Chinese Studio
Chinese Class
Learn English
Special English
Pop Chart
Everyday English
Fabulous Snaps
CRI News
APEC Yiwu Conference  |  China-Eurasia Expo  |  eBeijing  |  China Job  |  China Tibet Online  |  China Daily  |  Global Times  |  Xinhua  |  China.org.cn  |  CNTV.cn