Based on data from the International Organization of Motor Vehicle Manufacturers, ReportLinker’s economists and artificial intelligence experts created a forecast that highlights that new passenger car sales in China should reach 29,7 million by 2020.
This means that between 2017 and 2020, new car sales in that nation will maintain an annualized growth rate (CAGR) of 7.06%. That rate of growth is slower than it has been in recent years up until now, but it remains a sustainable one.
Should Chinese new passenger car sales reach this expected level, it will mean that China, which already leads the globe in new passenger car sales, will account for 30% of total market share in 2020.
Several factors are driving the increasing growth of China’s passenger car sales.
-One of these is the increasing average income of Chinese households, allowing more Chinese citizens to enjoy the freedom and independence that come with owning a car, owning more than one, or having a more reliable, comfortable one.
-At the same time, a relatively small percentage of Chinese presently own a newer make of car, meaning there’s plenty of demand to be fulfilled.
-And then there’s the increasing urbanization of Chinese citizens as they seek work and social opportunities in cities, meaning there’s an escalating desire for more mobility. The most dynamic automotive market growth is expected to be in lower-tier cities where citizens will be less drawn to live within the city or to rely on other means of transportation such as cabs, metro buses, or simply walking everywhere.
China’s Ministry of Industry and Information Technology (MIIT) and two other government agencies also said that they’re encouraging the growth of car sales by seeking to increase the buying of new energy vehicles (NEVs) to 2 million units by 2020. NEVs include electric/hybrid cars and fuel-cell cars.