Business / Auto China

Year of Horsepower: Car industry shifts gears

By Li Fangfang, Xu Xiao and Li Fusheng (China Daily) Updated: 2014-02-10 07:21

Opportunities, hurdles to arise in changing market

Editor's note: Ending two years of stagnation, the Chinese auto industry achieved double-digit growth in 2013. In the same year, the government released groundbreaking regulations on warranties, and car manufacturers showed a growing concern for quality as demonstrated by their increased willingness to issue broad recalls. Though the market faces challenges from local efforts to restrict car purchases, the government's renewed commitment to subsidies for green vehicles offer hope to this emerging sector. China Daily Motoring Weekly gives an retrospective to the influential and representative industry news in 2013.

Surge in sales ends yrs of stagnation

Year of Horsepower: Car industry shifts gears

China's passenger vehicle sales recovered from nearly two years of stagnation to surge 17 percent on an annual basis in 2013.

Last year, sales totaled more than 17.18 million units, far exceeding the industry's earlier expectations of single-digit growth.

Statistics show that China's passenger vehicle sales hit new monthly records consecutively in November and December, pushing total vehicle sales to beyond 20 million units.

However, analysts predict that the sector will see a relative slowdown in 2014 as more cities across China implement vehicle restrictions to combat rising pollution.

The China Passenger Car Association forecasts more than 12 percent annual market growth for 2014 if there are no big policy changes.

IHS Automotive predicts this year's light vehicle sales - 76 percent contributed by passenger vehicles - will rise 11.76 percent year to 20.77 million units, and total vehicle sales will grow 9.04 percent to 22.65 million unit.

Though it admitted that the market is cooling down, KPMG still remains confident about the picture in the long run.

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