Page 158 - 2020 White Paper on the Business Environment in China
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0 White Paper on the Business Environment in China
2.3 Automotive Industry
Key Take-Aways in Sichuan province, Xi’an in Shaanxi province,
and Xiamen in Fujian province. According to the
The vehicle population in China has been China Automobile Dealers Association, about
increasing in the last decades and 13.82 million used cars were traded in China
stood at 240 million as of the end of 2018. in 2018, less than half of the new vehicles sold.
Compared with developed countries where sales
In the first half of 2019, China’s automobile pro- of secondhand cars are usually twice the number
duction and sales reached 12.13 million and 12.32 of new car sales, China’s used vehicles exports
million units, respectively, down 13.7 percent and market has huge growth potential. China is the
12.4 percent year-on-year. This was due to multiple world’s biggest auto market. Currently, domestic
factors, such as the slowdown of the macro econo- automobile market is maturing and has entered
my, the early implementation of China VI emission a slow-growth period. It is inevitable that in
standards and the country’s auto market saturation. the future China’s secondhand cars market will
As for new energy vehicles, production and sales maintain sustainable growth. Secondhand car
stood at 614,000 and 617,000 units respectively, an exports is a major measure to stabilize foreign
increase of 48.5 and 49.6 percent over the same pe- trade, also an important way to deepen the Belt
riod from the previous year. and Road Initiative cooperation and promote the
high-quality development of foreign trade. The
China will scrap foreign ownership limits on local new program could promote the circulation of
auto firms by 2022. secondhand cars, speed up vehicles upgrading
and promote new vehicles consumption. China’s
China’s auto dealers are likely to face more pres- automobile products could enter the international
sure in by 2020 because of weaker demand com- market via the export program, absorbing excess
pounded by the earlier-than-expected adoption of capacity. Meanwhile, secondhand cars exports
tougher emissions standards in some regions. can reduce the number of domestic abandoned
vehicles and help reduce the pressure from
The nation plans to have smart cars with partial environmental protection. The Ministry of
or fully autonomous functions accounting for 50 Commerce, the Ministry of Public Security and the
percent of the new vehicles sold in the nation by the General Administration of Customs also released
end of 2020.China will become the world’s largest a guideline in late April 2019 which required the
market for internet of things by 2022, with annual development of sound inspection and after-sales
expenditure of US$300 billion. services for secondhand cars exports (Yu).
Background The incentives and new regulations did little
to boost China’s stalled car market. China’s listed
China officially launched exports of carmakers continued to paint a gloomy picture
secondhand cars in May 2019, with Beijing, for the first half of 2019. Among 17 A-share or
Tianjin and Shanghai among the first batch of 10 H-share listed passenger car companies, 12 saw
regions allowed to export the vehicles. The 10 falling net profits while five had net profit growth;
regions are Beijing, Tianjin, Shanghai, Guangdong for the 12 commercial vehicle enterprises,
province, Taizhou in Zhejiang province, Jining nine registered a decline in profits while three
and Qingdao in Shandong province, Chengdu posted profit increases. The overall sales
decline in the market led directly to carmakers’
158
2.3 Automotive Industry
Key Take-Aways in Sichuan province, Xi’an in Shaanxi province,
and Xiamen in Fujian province. According to the
The vehicle population in China has been China Automobile Dealers Association, about
increasing in the last decades and 13.82 million used cars were traded in China
stood at 240 million as of the end of 2018. in 2018, less than half of the new vehicles sold.
Compared with developed countries where sales
In the first half of 2019, China’s automobile pro- of secondhand cars are usually twice the number
duction and sales reached 12.13 million and 12.32 of new car sales, China’s used vehicles exports
million units, respectively, down 13.7 percent and market has huge growth potential. China is the
12.4 percent year-on-year. This was due to multiple world’s biggest auto market. Currently, domestic
factors, such as the slowdown of the macro econo- automobile market is maturing and has entered
my, the early implementation of China VI emission a slow-growth period. It is inevitable that in
standards and the country’s auto market saturation. the future China’s secondhand cars market will
As for new energy vehicles, production and sales maintain sustainable growth. Secondhand car
stood at 614,000 and 617,000 units respectively, an exports is a major measure to stabilize foreign
increase of 48.5 and 49.6 percent over the same pe- trade, also an important way to deepen the Belt
riod from the previous year. and Road Initiative cooperation and promote the
high-quality development of foreign trade. The
China will scrap foreign ownership limits on local new program could promote the circulation of
auto firms by 2022. secondhand cars, speed up vehicles upgrading
and promote new vehicles consumption. China’s
China’s auto dealers are likely to face more pres- automobile products could enter the international
sure in by 2020 because of weaker demand com- market via the export program, absorbing excess
pounded by the earlier-than-expected adoption of capacity. Meanwhile, secondhand cars exports
tougher emissions standards in some regions. can reduce the number of domestic abandoned
vehicles and help reduce the pressure from
The nation plans to have smart cars with partial environmental protection. The Ministry of
or fully autonomous functions accounting for 50 Commerce, the Ministry of Public Security and the
percent of the new vehicles sold in the nation by the General Administration of Customs also released
end of 2020.China will become the world’s largest a guideline in late April 2019 which required the
market for internet of things by 2022, with annual development of sound inspection and after-sales
expenditure of US$300 billion. services for secondhand cars exports (Yu).
Background The incentives and new regulations did little
to boost China’s stalled car market. China’s listed
China officially launched exports of carmakers continued to paint a gloomy picture
secondhand cars in May 2019, with Beijing, for the first half of 2019. Among 17 A-share or
Tianjin and Shanghai among the first batch of 10 H-share listed passenger car companies, 12 saw
regions allowed to export the vehicles. The 10 falling net profits while five had net profit growth;
regions are Beijing, Tianjin, Shanghai, Guangdong for the 12 commercial vehicle enterprises,
province, Taizhou in Zhejiang province, Jining nine registered a decline in profits while three
and Qingdao in Shandong province, Chengdu posted profit increases. The overall sales
decline in the market led directly to carmakers’
158
