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Business / Motoring Opinion

China's auto geared for growth despite slowdown

(Xinhua) Updated: 2014-04-25 10:12

BEIJING -- China's automotive industry will keep the forward momentum this year propped by strong demand and a new energy vehicle boom despite increasing downward pressure on the country's economic growth, analysts said.

Jia Xinguang, an auto analyst, said the slowdown was unlikely to weigh on the automobile sector, which is expected to maintain its rising streak this year.

Vehicle sales in China surged to 21.98 million units in 2013, with production amounting to 22.12 million, against a lackluster industrial climate. The figures marked the country as the world's largest auto market for the fifth straight year.

In the first quarter of this year, the sector continued to show impetus with an over-30-percent sales growth rate on a month-to-month basis in March, despite the economic growth dip to the lowest quarterly level since the third quarter of 2012.

Jia highlighted robust demand in the country's third and fourth-tier cities where there are no purchase restrictions as in a few large cities of east China to ease traffic.

During the ongoing auto exhibition in Beijing, both homegrown and international carmakers showed their eagerness to tap the potential of the largest car market, with more than 1,130 vehicles being exhibited and 118 debuting, hitting a record high in the show's history.

The popularity of the event further dismissed concerns that the country's frugality campaign and environmental protection drive will be a shadow over the sector's development.

The China Association of Automobile Manufacturers (CAAM) predicted the country's auto sales will grow 8 to 10 percent year on year in 2014, as the country is at the automobile purchase expansion stage, and promotion of urbanization and consumption upgrade will help boost demand.

Under the backdrop, Wang Zhonghong, researcher with the Development Research Center of the State Council called for more efforts to develop new energy vehicles which will not only provide a major driving force in the future but accelerate structural adjustment for the sector's sustainable growth.

His words were shared by Jia who also underlined the significance of the green vehicles.

The Chinese central government has rolled out measures since 2010 to promote new energy cars, ranging from subsidies to facility construction. The efforts were intensified in 2014 as the authorities expanded its pilot program to put more new energy vehicles on the streets, covering 40 major cities in the country.

Boosted by the top-down policy, new-energy vehicle sales nationwide jumped 37.9 percent year on year in 2013, and soared around 120 percent in the first quarter from the same period of last year.

China's auto geared for growth despite slowdown

SUVs at Beijing auto show

China's auto geared for growth despite slowdown

World premieres at Beijing auto show

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