Archives for January 2017

China car sales analysis 2016

China-car-sales-graph-2003-2016For years, analysts have predicted a slowdown of Chinese car sales. After becoming the world’s largest market in 2013, outpacing the United States, it was believed the market could not sustain its impressive growth record. Then halfway through 2015, the critics finally appeared to find reality on their side, when Chinese stock markets suddenly crashed and the economy stalled. Add to that a government crackdown on corruption and the recipe for a slowdown in car sales was ready. However, the central government stepped in and lowered the sales tax for vehicles with engines of 1,6 liters or smaller from 10% to 5%, starting from Q4 of 2015. That helped car sales peak recover and 2015 set yet another sales record of over 20 million passenger car sales. In 2016, the tax break continued and the market grew further, adding another 17% to 23,6 million sales.

Country of origin

  2016 Change 2016 Share 2015 Share
Domestic +27,4% 41,4% 38,1%
European +9,8% 22,4% 23,9%
Japanese +11,5% 16,0% 16,8%
US +13,9% 12,5% 12,9%
Korean +6,7% 7,6% 8,3%

60% of the growth came from domestic brands, as 9,8 million of the 23,6 million sales bore a badge from a Chinese brand, a record 41,4% of the total market. The previous record was 38,1% in 2015, which means local brands added 3,3 percentage points of share in a single year. Chinese brands increased their sales by 27,4%, more than double the growth rate of any of the other countries, as all saw their shares reduced. European brands took the biggest hit, losing 1,5 percentage points of market share to 5,3 million sales, with PSA Peugeot-Citroën as the biggest cause of concern. The American brands did best of the rest, losing just 0,4 percentage point of share to 2,96 million sales. Japanese brands sold 3,8 million cars in China in 2016 and South Korean brands sold 1,8 million units. All figures are for locally produced models only and exclude imports, which make up just 5% of the Chinese car market.… Continue Reading …

US sales 2016 Subcompact segment

Sales of subcompact cars rebounded slightly in the fourth quarter of 2016, growing by 2 percent relative to Q4’15, allowing the segment to cut the annual fall in sales to 3 percent. This is a very respectable performance for a segment where most cars are older designs, either in the second half of their life-cycle (Nissan VersaToyota Yaris) or about to be replaced (Chevrolet SonicFord FiestaHyundai Accent and Kia Rio). And while the segment still only sells less than a third of what the Compact segment manages, 2016 is notable as the first time that the Subcompact segment outsold the Minivan segment over the course of a year.

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China car sales analysis December 2016

China-car-sales-graph-december_2016It’s only fitting to see the Chinese car market end 2016 with yet another sales record broken: for the first time in history, more than 2,6 million cars were sold in the People’s Republic in a single month. To put this in perspective: this is almost as many cars as were sold in the UK in all of 2016, and over 900.000 units or 54% more than the 1,69 million cars US auto dealers sold in December, both figures are also records by the way. In relative terms, December’s 9,3% growth rate was the smallest since April and only the third time in 2016 the Chinese car market grew by less than double digits. Part of the explanation for this is that December 2015 was already a monster month, but still the Seasonally Adjusted Annualized Selling Rate came in at 25,1 million units, lower than the 3 months prior, reflecting December is traditionally the biggest selling month for Chinese car dealers. The sales tax break from 10% to 5% on vehicles with engines smaller than 1,6 liters which has fueled the market since October 2015 and which had been anticipated to be cut for 2017 will be phased out slowly to soften the blow next year. In 2017 these vehicles will incur a 7,5% sales tax before going back to 10% in 2018. Still, a more moderate growth rate is expected for 2017, especially in the first quarter. Then again, this is what experts have been predicting for a few years now, and somehow the market keeps proving them wrong.… Continue Reading …

US sales 2016 Minicar segment

US-sales-minicar-segment-2016-Chevrolet_Spark-Mitsubishi_Mirage

The Minicar segment in the United States has been hurt badly by the low gasoline prices in 2016, with sales down 11.0%, the worst fall from all the segments. However, the situation improved markedly for the segment in Q4, when it was the only segment to substantial growth (5.6 percent), driven mainly by substantial sales growth for models: Chevrolet Spark and Mitsubishi Mirage.

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Look-a-like: Kia Stinger and…

The Kia Stinger is probably our favorite car to debut at the 2017 Detroit Auto Show, and with good reason – it is a powerful, RWD 5-door coupe which shows that Kia is not afraid to go toe-to-toe with Audi and BMW. Most important, though – it looks great, with a squat stance afforded by its width and low height, as well as a swept-back proportions that make it look as though it’s going fast even when it’s standing still. And it’s exactly that last part, those unique proportions, that to my eyes owe a debt of gratitude to another great-looking car, and not coincidentally a part-rival which the Kia will undercut significantly on price, if not looks…

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Predictions for 2017: US

Looking ahead, even one year, can be very tricky. Last year we nominated two brands as potentially doing well in 2016, and ended up being only half right: we correctly predicted Volvo‘s growth, but thought that Buick would do better than barely out-performing the market. We did even less well when predicting the disappointments of 2016 – both Cadillac‘s and Mitsubishi‘s sales in 2016 were not great, but still better than for many of their competitors. Cadillac’s sales may have fallen by 1.9 percent compared to 2015, but the brand still did better than Lexus (down 3.9 percent), Acura (down 8.9 percent) or BMW (down 9.5 percent). Mitsubishi did even better, with sales actually rising by 1.0 percent compared to 2015, better than many more fancied brands such as Mazda (sales down 6.7 percent), Chevrolet (down 1.4 percent), Toyota (down 0.7 percent) or Ford (down 0.6 percent). Time will tell whether we do better this time around!

1. Honda: success

Honda had a very good 2016, with growth its growth of 4.8 percent handily out-pacing the decline in sales among the three brands ahead of it (FordChevrolet and Toyota). This performance came from the sales growth in two new mainstream models: the Civic (sales up 9.4 percent) and HR-V (sales up 95.5 percent). The reason we can expect the good times to continue at Honda is that for 2017 it has three new models: CR-V (revealed in the fall of 2016), Odyssey (revealed in Detroit this week) and Accord (to be revealed soon). Of the three, Civic and Accord regularly rank in the top 10 of model sales, with the Odyssey adding another 100k+ of sales each year – it should thus be reasonable for Honda’s sales to go up significantly once all of those models hit the market.

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Detroit Auto Show: the Good, the Bad, and the Ugly [w/ poll]

Here’s our take on the hits and misses of the Detroit Auto Show, make sure to let us know what you thought in the poll and the comments section!

BMW 5-series

BMW_5_Series-2017

Bart: Hit

Packed with new technology and undoubtedly again being one of the best driving sedans in its class, the new 5-Series will (depending on your personal preferences) either come close to or beat the standard set by the new Mercedes-Benz E-Class. But where the E-Class was mostly criticised for looking too much like its larger and smaller siblings, the 5-Series looks too much like the previous model. Did I miss the news that BMW hired a former Volkswagen designer? However, this doesn’t mean I don’t like its looks. With the right (M-Sport?) bodykit and wheels and a color a bit more inspiring than the obbligato fifty shades of grey, blue or black, this can be a very desirable looking car that will remain the obvious choice for the decreasing number of luxury buyers who still prefer a sedan over an SUV.

Kriss: So-so

I agree with pretty much everything Bart said, and yet I still can’t rate the BMW a “Hit”. Why is that? Objectively, the car has everything going for it – technology, BMW’s legendary chassis tuning, straight-six engines, and a smart and light construction (recently read a comparison test with the E-class, and saw that the 4wd 530d xDrive is 100kg lighter than the 2wd E-class 350d). However, subjectively the car is lacking that certain “want it” factor – the one that made the E34 and E39 generations so achingly desirable, no matter what specification or color they were in. While the E-class boast a stunning interior, the BMW looks too much like its predecessor inside; to me this is especially disappointing given that BMW showed us with the i3 and i8 of creating genuinely stunning interiors. Call it a case of sky-high expectations, but the new 5-series is just not a “Hit” to me.

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Look-a-like: GAC GS7/GS8 and…

GAC GS8 and its smaller brother GS7 (which made its debut in Detroit this week), are two of the more eye-catching cars to come from a Chinese manufacturer recently. What makes them stand out is that they have something that many Chinese (and, for that matter, other) cars lack – a clean and confident design that’s instantly recognizable thanks to a memorable lights and grille treatment that, with familiarity, might evolve into the “GAC family look”. That said, despite the end-product being pretty unique-looking, from the front the cars remind me more than a bit of a well-established American SUV… 

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US sales: December 2016, models

 

After discussing the US auto brand sales ranking for December, let’s zoom in on the models.… Continue Reading …

Predictions for 2017: China

We’ve discussed the 2016 success stories and disappointments of the Chinese car market, now we’ll focus on our expectations for 2017, like we’ve done for Europe. Looking ahead, even one year, can be very tricky. Last year we predicted EVs and PHEVs in China to continue their boom. From January to November 2016 sales of New Energy vehicles increased 102% in a market up 18%, to 282.292 units, including 41.796 in November alone. Pure electric car sales were the bulk of that volume with 208.839 units, an increase of 145%, while plug-in hybrid sales increased 35% to 73.453 units. And the good news is that although electric minicars/citycars still make up the bulk of China’s pure EV sales (62,2%), the real growth comes from the compact EV segment with sales up almost 9-fold. We also predicted two disappointments for 2016: DS and Volkswagen. DS was a no-brainer and you can read in our disappointments article, and for Volkswagen we said it would have to get used to single digit growth but the brand has shown remarkable resilience and has managed to grow 12,7% through November. While that’s still slower than the overall market, keep in mind the brand has completely missed the crossover hype in the same way PSA has, but it sedan-heavy line-up has continued to sell well. VW has launched 3 new nameplates in 2016: the Sportsvan has outsold its rival BMW 2-Series by almost 3-to-1, the Phideon is more of an image booster than a volume model at 800 monthly sales, but the C-Trek is the most promising with 5.600 sales in its first month.

1. Jeep: success

Jeep_Compass-China-2017Like DS was last year, Jeep is a no-brainer here. The American SUV brand could easily have been mentioned among our success stories of 2016, as it has sold well over 100.000 units in its first year of local production in China, peaking at over 16.000 sales in November with its two models: Cherokee and Renegade. That puts the brand ahead of Cadillac, which did get a mention as one of the most successful brands in China last year.… Continue Reading …