Cars have become the every day necessities

As China’s economic development promotes the upgrading of consumption, cars have become the every day necessities of ordinary people in lieu of exclusive luxury goods to the high-income group. Due to the financial crisis, the economic growth of global major economies including China slows down obviously. However, in China, the sustaining growth of the demand potential in the auto industry displays the growingly prominent role of this industry in the national economy. In 2009, China realized the auto sales volume of over 13 million, becoming the global largest new vehicle market for the first time. The role of the auto industry as the pillar of the national economy is unanimously recognized by Chinese governments at all levels. This lays a favorable owner foundation for the sustainable development of Chinese auto market in the future.

However, the situation of the auto market differs in different regions of China. On one hand, large gaps exist in the economic development levels of different regions. For example, in 2009, the GDP per capita was over USD 11,000 in Shanghai, very ten times the USD 1,300 in Guizhou. On the other hand, the geography, climate & history culture also vary from region to region. The local matchless culture features will be demonstrated more prominently in the auto markets of miniscule & medium cities yet there’s numerous miniscule & medium cities in China; the scale of a single market is comparatively miniscule & the difference in culture & economy will be large. Thus, the auto distribution industry has to establish channel models & marketing modes in accordance with the situation of the markets.

The auto markets in Chinese first-tier cities (Shanghai, Beijing, etc.) are similar to that of developed countries (USA, Europe, Japan, etc.) in the limited market growth space. The rigid demand in Chinese auto market comes from those urban families that have not bought cars. These families chiefly concentrate in miniscule & medium cities. It is forecast that the auto purchase demand in Chinese miniscule & medium cities will be fully released in the coming years. The effective channel models & marketing modes in Shanghai, Beijing & Shenzhen, etc will be adopted by hundreds of miniscule & medium cities, & even over 2,000 counties in China. However, there will be the issue of inapplicability then. Thus, in the following years, one core issue to be solved for the competition of the auto distribution industry is how to establish the applicable sales & marketing systems in those high-speed developing auto markets of Chinese miniscule & medium cities.

With the continuous development of the marketing philosophy & the gradual maturing of Chinese auto market & consumer psychology, the competition on the whole vehicle sales market will be more intense & the profit growth of the whole vehicle sales well be very limited. With the sustaining growth of Chinese income per capita & the rapid growth of personnel automobile purchase, Chinese auto purchasers will pay more attention to services in lieu of products. In the future, service will become a major aspect for Chinese auto distributors to establish competition advantages. Besides the necessary services for sales & after-sales repair, value-added services (auto leasing, auto maintenance, auto replacement & rapid service chain) will accomplish rapid development.

• Digg
• Stumble it!
• Reddit

Comments are closed.