By CCTV correspondent Xia Cheng
Chinese car shoppers' taste is evolving. As owning a car slowly slowly becomes a necessity instead of a luxury in China, consumers start to weigh the choice between flashy high-end vehicles and more affordable wheels.
Global automakers have long made inroads into China, the world's biggest auto market.
Sales are forecast at growing 8% per annum until the year 2020, with sales volume reaching 22 million cars a year. That's more than Europe or the US.
Many Chinese middle-class families have already landed on a first, entry-level car. They are ready for something better but can they afford it?
"I've been very bearish on the idea that salary increase will slow and that sentiment at the white collar level would be not as good as, let's say compare to the blue collar level, where salaries are rising faster," Scott Laprise, Steel & Autos Analyst of CLSA, said.
On the bright side, it'll be easier for Chinese car buyers to finance their purchases.
"The majority of car loans is offered by commercial banks, cuz those banks have the typical customers relationship, they know customers well. In the last few years we've seen is the fast growth of OEMs, the manufacturers, offering car loans through their financial divisions," Patrick Steimann, Managing Director of Bofa Merill Lynch, said.
That's why, as Marco Gerrits, Partner & Managing Director of Boston Consulting, explains, Chinese OEMs should firm up their home base.
"If you are talking about China, it's not only about products, it's also the development of the downstream business: the services behind it, the networks behind it. Obviously we get more and more mature customers in China, more and more demanding," Gerrits said.
The local car culture is probably among the best in China. That's why many luxury brands are gearing up, for a major push in Chinese market.
Vintage cars for the historic city, a marketing strategy to stoke the desire for classy wheels.
"Our intention is to develop the sports car culture, car culture, having in mind as well, the history of cars, the heritage of cars," Dr. Jochem Heizmann, President & CEO of Volkswagen China, said.
Keen to make car culture part of the mainstream culture, automakers are using sponsorships to speed up brand recognition.
This works well in Shanghai, home to a series of international car races.
Beside those bells and whistles, getting from A to B and good value are always best selling points for first-time buyers.
As China switches gear to a consumer-driven economy, car makers are tagging along for the ride.
- Editor:Annabelle | Source: Agencies
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