Dynamic Off-Road Market in China

SEMA News—May 2015

INTERNATIONAL
By Linda Spencer

Dynamic Off-Road Market in China

Media Giant FB Life Provides Insight


Off-roading is a popular pastime. Pictured here is a recent gathering hosted by FB Life which highlights the impressive size of this event and the mix between large-size pickups and SUVs as the vehicle of choice for these expeditions.
Off-roading is a popular pastime. Pictured here is a recent gathering hosted by FB Life which highlights the impressive size of this event and the mix between large-size pickups and SUVs as the vehicle of choice for these expeditions. The media/event organizers recently conducted a survey of more than 5,000 enthusiasts to learn more about the typical off-roading enthusiast. The survey covers everything from average age, marital status, education, income and the number of vehicles owned.

   
     

SEMA members are invited to explore the Chinese market in the asso­ciation’s annual trip, which is sponsored by SEMA in partnership with the U.S. Department of Commerce.
SEMA members are invited to explore the Chinese market in the asso­ciation’s annual trip, which is sponsored by SEMA in partnership with the U.S. Department of Commerce. The trip will take place September 16–20, 2015, in Shanghai. Registration and more information is avail­able at www.sema.org/china. Pictured here is Scotie Selman of Derive Systems at the 2014 event. 

   

The specialty-equipment market in China is booming, with perhaps no sector growing more rapidly than the off-road market. SEMA News recently talked about the off-road scene with Baokun LV, co-founder of FBLife.com and executive general manager of FB Life, a Chinese media giant and a platform for off-road enthusiasts and service suppliers.

 

The majority of vehicle owners are men, though nearly a one-fifth are women.
The majority of vehicle owners are men, though nearly a one-fifth are women.

  About 60% have college educations, and 33% have post-college educations.

About 60% have college educations, and 33% have post-college educations.

 

About 79% earn at least $40,000 USD a year, and 30% of those surveyed brought home at least $80,000 a year.
About 79% earn at least $40,000 USD a year, and 30% of those surveyed brought home at least $80,000 a year.

 

The majority of off-roading enthusiasts participating in FB Life events (71%) are between the ages of 26 and 45.
The majority of off-roading enthusiasts participating in FB Life events (71%) are between the ages of 26 and 45.

 

The FB Life survey reported that 61% of respondents own two or three vehicles, with 22% owning more than three vehicles.
The FB Life survey reported that 61% of respondents own two or three vehicles, with 22% owning more than three vehicles.

   

FB Life is known for its Chinese-language automotive online website. The company also sponsors driving tours, outdoor photography and scientific expeditions, and it hosts large-scale off-road events and races.

Most Popular Off-road Vehicles

The Jeep Wrangler and Grand Cherokee and the Japanese Toyota Land Cruiser series, including the LC 200 and LC 100, are the SUVs of choice for truck enthusiasts in China, but a growing number of Chinese have been purchasing fullsize pickups as the off-roading scene there evolves. LV estimated that these mostly large, U.S.-built pickups now make up 20% of the vehicles taking part in off-road events.

Ford F-Series trucks, Toyota Tundras and Dodge Rams have been spotted on FB Life tours. More recently, the more niche Nissan Patrol pickups and Escalade pickups have also made appearances. As for other trends, LV noted that bigger is better for a portion of the off-roading population. He said that his company is now also seeing some Super Duty pickups, including F-350s, F-450s and F-650s. As for small pickups, they are seen on off-road racing tracks, since the smaller and lighter trucks are good fits for racing.

Among the most popular vehicles for Chinese enthusiasts are the Ford F-Series and Toyota LC 71. The Raptor and Tundra are also extremely popular, but vehicle sales data provide only partial information, as virtually all of the large pickups used by consumers are brought in informally through the gray market and are not sold officially by the car manufacturers. These sales are not recorded in many of the available data, because the vehicles are purchased through dealers or third parties and then shipped to China.

Most Common Upgrades

FB Life hosts its largest annual event in the Gobi Desert in Inner Mongolia. The most common upgrades among those participating in the trips are functional items to enable enthusiasts to more fully master the terrain. The top two items LV mentioned were performance suspensions and bigger tires. Next on the list were gasoline tanks, luggage racks, bumpers, winches, headlights and auxiliary lights.

LV said that the perception among Chinese consumers regarding U.S. specialty-equipment products is very upscale and high quality.

“Chinese consumers have a special liking for U.S. specialty products,” he said. “I hope that American brands seize the opportunity now. I understand that American companies base their decisions on statistics, but this market is still in a gray area. That is why it is hard to get a hold of very accurate statistics now.”

He added that there is a strong need for additional U.S. products in China.

“I believe that the Chinese market is still in its baby stage,” he said. “We are witnessing more American companies coming to grow this market now. If American companies do not meet the needs, other companies will. Get your foothold when the market is still at its baby stage and come build your brands now. If you do not focus on this market now and perform excellent service to your customers, it will spoil your brands. Come wholeheartedly and build your brands slowly by performing good service to your customers.”

LV said that a new development is the growing competition from Chinese companies, which are also investing heavily in this market. For instance, Starworks and Topfire are growing very quickly.

LV conducted a survey of more than 5,000 enthusiasts to learn more about the typical off-roading enthusiast. What follows are the results of his survey regarding, among other questions, their age, income, education, number of vehicles they own, etc.

Among the conclusions, the survey indicated that off-road enthusiasts typically own two or more vehicles, are well educated (60% have a college education and 33% a post-college education) and are well off.

Vehicle ownership is high among those responding to the FB Life survey. For instance, 61% reported owning two or three vehicles, and 22% said that they owned more than three vehicles. In contrast, and in a big change from previous surveys of consumers, only 6% reported that they didn’t own a vehicle.

SEMA members are invited to download the full survey, which is posted at www.sema.org/international.

SEMA members are also invited to explore the Chinese market in the association’s annual trip, which is sponsored by SEMA in partnership with the U.S. Department of Commerce. With some distributors reporting 30% growth per year, now is an excellent time to exhibit in the SEMA section at the Shanghai-based China Auto Salon. Participants will meet with leading pre-vetted buyers from throughout China, visit local customizing shops and have access to vehicles popularly customized in the region but not sold in the United States. Limited slots and U.S. government subsidies to defray the costs are available for qualified companies. The trip will take place September 16–20, 2015, in Shanghai. Registration and more information is available at www.sema.org/china or by contacting Linda Spencer at lindas@sema.org.

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