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  4. > Strategic Analysis of the Chinese Powertrain Market : Gasoline Powertrain to Gradually Make Way for Electric Powertrain by 2020

Key Findings

China manufactures three types of powertrains—gasoline, diesel, and electric, both Electric Vehicles and Hybrid Electric Vehicles (HEV). The year 2013 was a record year for the Chinese powertrain market, as x million units of gasoline passenger vehicles were produced which is a global record. Gasoline powertrain is expected to lead the market till 2020, with approximately x million units.
Stable economic growth, rising incomes, recognition of individual esteem, infrastructure development and enhancement, an advanced automotive supply chain, competitive automotive promotional campaigns, new market segments, and Chinese Government plans and subsidies are expected to lead to significant growth of the powertrain market in China.
Both central and regional governments in China are promoting a new-energy vehicle development concept which aims to limit passenger vehicle ownership in the country and restrict exhaust emissions.
The C-compact vehicle segment dominates gasoline, diesel, and electric powertrains. This trend will continue till 2020. However, Sport Utility Vehicle (SUV) and Multi-purpose Vehicle (MPV) segments in gasoline, diesel, and electric powertrains are also growing and are likely to continue on the high growth trajectory till 2020.
In terms of transmission, Manual Transmission (MT) accounted for x % of market. However, the dominance of MT and Automatic Transmission (AT) will decrease by 2020, with the growth of Dual Clutch Transmission (DCT), Continuous Variable Transmission (CVT), and Electric Transmission (ET). Original Equipment Manufacturers (OEMs) are expected to further penetrate into DCT.

Top 10 Conclusions and Future Outlook

•The Chinese powertrain market produced x million units of which x % belonged to the gasoline segment, x % to the diesel segment and x % to the electric segment.
•Most globally-leading OEMs are refraining from operating in the diesel segment, including Ford, General Motors, Honda, PSA, Toyota, and Volkswagen.
•There are more than x OEMs—state-owned, joint-ventures, and private—in the Chinese automotive industry.
•Chinese consumers prefer joint-venture brands such as Shanghai Volkswagen (JV between SAIC and Volkswagen), FAW Volkswagen (JV between FAW and Volkswagen) and Beijing Hyundai (JV between BAIC and Hyundai), which have a greater brand image, higher perceived value, and favorable price.
•Volkswagen leads in the Chinese automotive industry with a share of x % in total production.
•Hyundai, General Motors, Renault-Nissan, Toyota, and Honda follow with a total share of x %.
•OEMs are further investing in SUV and MPV segments across tier I and tier II cities. Most SUVs have either gasoline or diesel powertrains.
•Consumers in tier III cities prefer to buy gasoline sedans as their first or second family vehicle.
•For EVs, OEMs are facing a shortage of key components and the issue of an incomplete EV supply chain.
•Misconceptions about diesel vehicles, such as emission of black smoke and poor engine performance, is a huge issue in China.
•Furthermore, the growth of the ecommerce website, Alibaba, and rising incomes are drivers for logistic enterprises. With long waiting times at fuel stations due to the presence of many logistics vehicles such as light- and heavy-duty trucks, consumers do not prefer diesel as a fuel.
•Medium-to-Long-Term Scientific & Technological Development, x Program, and New Energy Vehicle Development Program have been implemented to be in tune with the new global mega trend of environment protection and green environment.

•Chinese powertrain market is estimated to witness continuous growth with a production of x million units
•The gasoline segment is expected to remain dominant but with a slight decline in market share to x %. The market share of the electric powertrain is expected to grow to x %. The share of the diesel segment will remain at x %.
•Market concentration in the Chinese automotive industry is expected to continue to be low due to high rivalry and competitiveness.
•The market share, in terms of production, of the top 6 OEMs—Volkswagen, Hyundai, General Motors, Renault-Nissan, Toyota, and Honda—is expected to decline from x % in 2013 to x % by 2020,
•Market dynamics will be transformed with the improvement in performance of Chinese native brands owned by OEMs such as Chang’an, Geely, Great Wall, and SAIC.
•The EV production landscape is expected to transform. It will have a direct impact on the riseof Geely, Ford, Great Wall, PSA, Chery, Chang’an, Dongfeng, SAIC, and BMW.
•Chang’an, Geely, and Great Wall have good competitive potential, and are expected to have a market share of x % by 2020, as compared to the x % market share in 2013.
•Diesel powertrain production will rely mostly on SUVs.
•Government incentives and increasing the number of electric charging stations will generate more EV users.
•Further support from the Chinese Government and the successful launch of Tesla’s EV will attract potential EV components suppliers into China.
•Future measures such as tax exemptions for EVs, vehicle driving and purchase restrictions are expected to aid the expansion of EV usage.
•Under the new energy vehicle development push-pull strategy of the Chinese Government’s, rapid growth of the electric powertrain is expected.
•More campaigns are expected to be carried out in order to quicken the implementation of government regulations and policies.

Key Questions this Study will Answer

How is the Chinese powertrain structure expected to change as we approach 2020? What are the most dominant fuel and transmission types? What is the unit shipment production of Chinese powertrain systems in 2013 and what is the estimated unit production growth from 2013 to 2020?
Which are the key OEM participants in the market and how are the trends in the automotive industry changing? Who will emerge to be market leaders and accelerate market growth?
What are the key factors driving change in Chinese powertrain market? Do emission limits and government’s incentives define the innovation that may be possible as we approach 2020?
What is the dominant powertrain in China? Will new energy development and engine technologies such as turbocharging play an important role?
What are the pertinent indices to value the performance of powertrain systems? How will these systems evolve over the coming years to match market demands? What are some of the key conclusions with which to tackle and understand the dynamics of the current and future powertrain market in China?

Table Of Contents

Strategic Analysis of the Chinese Powertrain Market : Gasoline Powertrain to Gradually Make Way for Electric Powertrain by 2020
Executive Summary 3
Research Scope, Objectives, Methodology, and Background 18
Definitions and Segmentation 25
Market Overview 29
Mega Trends and Industry Convergence Implications 41
Total Powertrain Market -
• External Challenges: Drivers and Restraints 45
• Emission and Fuel Efficiency Standards 55
• Forecasts and Trends 73
• Powertrain Technologies 87
• Market Share and Competitive Analysis 95
Gasoline Segment Breakdown 108
Diesel Segment Breakdown 116
Hybrid and EV Segment Breakdown 124
Powertrain Market—Transmission 137
OEM Profiles 142
Conclusions and Future Outlook 148
Appendix 152

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