Business / Auto China

'Connected car' rewiring consumer demand

By Li Fangfang (China Daily) Updated: 2014-10-20 07:30

'Connected car' rewiring consumer demand

A long-distance bus driver in Bozhou, Anhui province shows his newly installed GPS system. The device can be used not only for navigation, but also for monitoring speed, greatly improving driving safety. [Photo provided to China Daily]

Survey finds high demand and use by Chinese buyers

Connected cars are so desirable in China that demand surpasses even Western auto markets, research company Nielsen found in a recent survey.

"Just as China is leading global smartphone and e-commerce trends, we find that Chinese consumers are also progressive in bringing technology to automobiles," said Pat Gardiner, president of global automotive division at Nielsen.

The company conducted global research to understand market trends around network-wired cars in a range of countries including China.

"The high interest from Chinese consumers demonstrates that China is a unique market for connected cars and will help international automakers understand how to create vehicles consumers want to buy," said Gardiner.

So-called connected cars use telematics that include wireless interfaces with vehicle technologies, road infrastructure, safety devices, networks and navigation hardware.

The survey interviewed 1,100 consumers in 10 Chinese cities who own cars for personal use and are decision-makers in their households.

"We found in the survey that Chinese consumers are much more engaged in the telematics in their cars than other markets. It's incredible," said Gardiner.

He told China Daily that the awareness of connected cars is very high among Chinese consumers, with some 87 percent of interviewees understanding the concept and products, much higher than the 57 percent in the United States.

"This is in large part driven by high adoption of in-car infotainment devices in China," he said.

According to the survey, 42 percent of car owners stated that they have telematics in their cars, and about 94 percent of those use the devices, also much higher than the 67 percent in the US.

Gardiner added telematics technology is an important factor for driving purchase decisions in China, with nearly half of the consumers surveyed rating it as one of the top five features they look for in a car - even before things like automatic steering.

Another highlight of the survey that impressed Gardiner was that famously price-sensitive Chinese consumers are more willing to pay more for connected products and services.

Nielsen found that Chinese consumers are willing to pay on average 590 yuan a year for connected technologies with some even willing to pay more than 1,500 yuan.

That contrasts with US and European consumers that are turned away by the expense of telematics systems, and are less likely to pay premium prices for them, according to Gardiner.

Furthermore, he never expected that more Chinese consumers are willing to pay for the advertise-supported models, four times more than that in the US. "That indicated a more flexible marker for connected cars in China."

'Connected car' rewiring consumer demand

'Connected car' rewiring consumer demand

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