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China Increased Demand for Sport Utility Vehicles

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China’s vehicle exports are expected to outpace imports again in 2006 despite the higher excise tax that fueled explosive growth in car imports during the first quarter. In terms of volume, exports will continue to surpass imports in 2006 as
more Chinese automakers eye selling low-priced cars to the huge overseas market.

 

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China Automotive Industry

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China is set to become the world’s second largest new automobile growth market by the end of 2006 and this growth is spurring demand for U.S. automotive parts, services, and aftercare products. The East China region in particular has tremendous opportunities as new car drivers become more sophisticated and demand better vehicle quality and better repair and maintenance service. U.S. exporters should be aware that while industry revenue is increasing, profit margins are slowly falling to international averages. Infringement of intellectual property remains a very serious issue.

 

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Hong Kong Automotive Parts and Components

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The Hong Kong automotive parts and components market is small, US$ 410 million, which is about 2% of the Mainland China market. Hong Kong has no automotive manufacturing and thus all vehicles are imported. Automotive parts and components

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East China Automotive Aftermarket

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China is the world’s third largest car market after the United States and Japan. Last year Chinese vehicle sales totaled five million. If the Chinese economy continues to grow at its current highsingle- digit rate, Chinese passenger vehicle sales are expected to grow annually 15-18% and reach 6 to 7.4 million by 2010. At this rate, China is expected to become the second largest market in the world for vehicle sales by 2010 and may be the world’s largest by 2015. This growth makes China
the fastest growing automotive market in the world and provides great opportunity for both foreign and domestic vehicle companies and component suppliers.

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List of Auto Parts Targeting to Enter the Chinese Specialty Equipment Market

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Vehicle customization has been growing rapidly in China, industry insiders estimate the Chinese specialty-equipment market is at approximately $12.5-$15 Billion USD. With 1.3 Billion in its population, vehicle sales reaching 93% of the U.S. passenger vehicle sales, according to data provided by JD Power & CAAM in January of 2009. SEMA has developed a new list of trade leads available to SEMA members online at www.sema.org/international. The Chinese government has begun to legalize specialty products for use in China. This is an initial list of approved products.

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The Specialty Equipment Aftermarket in China

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The Specialty Equipment Aftermarket in China, SEMA International From all the news out of China, it’s no wonder that specialty equipment companies are arriving at the conclusion that the Chinese specialty market is booming and sales are readily available to all who enter. Consulting firms, car companies and the press are all reporting on the rapidly expanding overall automotive market.

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China Media Editorial Contacts

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To assist our members in identifying the key media contacts in China, SEMA has compiled a list of top media editorial contacts in China. Media database is available online for members at www.sema.org/international. For more information on the SEMA report on the Chinese Specialty equipment Market contact Yvonne Wang.

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SEMA Programs for Global Enterprises

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As the global economy changes, many SEMA-member businesses are taking advantage of new business opportunities. To help its member companies discover the most viable regions for growth, SEMA has developed a system of international programs that provide the groundwork for global expansion. SEMA works with organizations all over the world to promote automotive specialty-equipment businesses using everything from market reports and news releases to vehicle databases and networking.

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Customizing in China

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The specialty-equipment aftermarket in China is booming. Although it is still relatively small in comparison to its 1.3 billion population, the market is showing encouraging signs of growth as consumers become more familiar with the concepts of customization, have the disposable income to afford it and are finally able to legally customize their vehicles, thanks to legislation recently enacted by the Chinese government. The market is already at an estimated $12 – $15 billion, and market insiders expect to see substantial growth in the upcoming years.

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Doing Business in China: What You Need to Know Before You Go

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Conrad Wong is the intellectual property rights (IPR) officer in the U.S. Embassy in China and represents the United States Patent and Trademark Office (PTO; www.uspto.gov) with the United States Consulate General in Guangzhou. We talked with him recently when he met with a delegation of SEMA executives visiting China to identify opportunities as well as challenges for association members seeking to sell into this large market of more than 1.3 billion people. Wong has 15 years of experience in intellectual property matters and is a car enthusiast.

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