The domestic passenger car market in China edges up by 0,8% in November 2017, to judy over 2.55 million sales, the highest volume of the year so far. With such a slow growth rate and a December ahead of us which showed booming growth rate last year, it will be difficult for the Chinese car market to reach its expected 5% growth rate in 2017. Year-to-date sales for the first 11 months are up 3,07% to 21,64 million and we expect the market to be stable again in December, which would give us a total of 24,24 million sales in 2017, up just 2,7% on 2016 and the slowest growth rate in modern history, down from 17,2% last year. At least we can be almost sure the market will show another record year as sales would have to be downby 25% in December for a full-year decline (or down to its 2015 level, which hasn’t happened a single time so far this year). Last December, consumers were rushing to buy new vehicles before the sales tax increase on vehicles with engine sizes of 1.6 liters and below rose from 5% to 7,5% on January 1st, 2017. A similar effect will be noticeable this year, as the tax will increase to 10% on January 1st, 2018.
Back to November: the only segment to show growth was that of crossovers and SUVs again, which were up by 10% to nearly 1,1 million sales (YTD up 14%), while sedans were down 3,8% to 1.23 million sales (YTD down 1,4%) and MPVs took the biggest hit at -10,3% to 227.000 sales (YTD down 12,5%). Within those sales figures, sales of electric cars and plug-in hybrids (New Energy Vehicles) jumped 83% to 119.000, or 4,7% of the market. Full EVs took the grunt of those sales, rising 75% to 102.000 while PHEVs gained 154% to 17.000 sales. For the first 11 months, EV and plug-in hybrid sales rose 51% to almost 609.000 units, or 2,8% of the total market. The Beijing government has set a target of 6,7% in 2020 and as much as 20% by 2025, helped by a carbon credit scheme that was originally planned to be imposed in 2018 but which has been postponed to 2019. This year, total sales of New Energy Vehicles are expected to top 700.000. [Read more…]