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China's Young Car Market Offers Plenty of Target Models for SEMA Members
|There are 42 million cars on the road in China, the majority of them privately owned. J.D. Power and Associates predicts that number to grow more than 20% in 2010.|
Private passenger-car sales only took off in China around 2001. Initially, the government was the main consumer of vehicles of all kinds. Private car ownership was out of the reach of most Chinese. But China’s World Trade Organization (WTO) entry in December 2001 brought a rush of foreign investment, accompanied by gross domestic product growth as exports and imports surged. People’s incomes began to rise on the back of that growth.
Markets also opened, and more foreign automakers began producing cars in China through joint ventures. New domestic automakers popped up like mushrooms, and consumers soon had hundreds of models to choose from. Today, though, the market is barely a decade old and there are some 42 million cars on the road, the majority privately owned. That number is growing fast.
Despite a widely reported slowdown of China’s automotive market, it will still show double-digit growth in 2010. J.D. Power and Associates forecasts 2010 light-vehicle sales to grow 20% to more than 15.6 million units in China. The U.S. market is forecast to grow 12% to 11.7 million units.
More than 20 SEMA-member companies attending the SEMA-CIAPE China Business Development Conference in Beijing in late September will have the opportunity to take part in that growth. Participating SEMA members will be paired with relevant Chinese buyers in private, pre-scheduled meetings. One-on-one meetings with potential Chinese partners at this groundbreaking event will allow SEMA members to get to know the Chinese companies and the China market.
For example, SEMA members producing suspensions might be interested to know that SUVs are a hot segment in China. In 2009, more than 847,000 SUVs were sold, up 43% on-year, according to J.D. Power and Associates. The Toyota RAV-4 has long been a hot-selling model in China. There are now more than 123,300 on the road, according to R.L. Polk and J.D. Power data.
For members interested in producing products for domestic SUVs, the Great Wall Hover is a best-selling model. More than 168,000 are on the road, and sales of the model more than doubled in the first five months of 2010. SEMA members in Beijing can ask potential Chinese partners about their product’s suitability for such domestic models. The members signed up to attend the conference in Beijing, September 23–26, include:
- AEM Performance Electronics
- American Eagle Wheel
- BDS Suspension
- Comp Performance Group
- DELTA TECH Industries
- Eibach Spring
- eBay Motors
- Holley Performance Products
- Injen Technology
- K&N Engineering
- NITTO Tires
- Mr. Gasket/Prestolite Performance
- Performance Motorsports
- Rennen International
- SCT Performance
- Sheen Coatings
- ThyssenKrupp Bilstein
- Wheel Pros
From wheels to high-performance suspensions to products that make tires shine, the luxury segment has a lot of potential for SEMA members. Audi is the best-selling luxury brand in China, and more than 730,000 Audis are on the road in China today. Audi has produced domestically for decades. The imported Lexus brand has been available in China for a much shorter time, yet there are more than 250,000 are on the road today.
Learn about other segments and models that are hot markets for your product from the men who are on the ground there. Register for the SEMA-CIAPE China Business Development Conference by contacting Linda Spencer at LindaS@sema.org or online at www.SEMA.org/china.