New Market Research Report: China Autos Report Q3 2010

June 6, 2010 - PRLog -- China's auto industry may have sustained its rapid growth heading into 2010 with production and sales both up over 70% in Q110, but BMI believes this kind of breakneck pace cannot be maintained for the whole year. We expect more restrained growth in 2010, of around 15%, although this is a slight upward revision of our previous forecast of 12%. We expect a slowdown during the second half of the year as a natural cooling off period will follow such a high. It is also unclear how long the extended government incentives will last, with a drop off likely to follow their withdrawal. However, as a result of the surge in sales, several carmakers in China are planning capacity expansions, which has fuelled concerns of overcapacity when sales growth slows.

The government has implemented a number of policies to ensure the industry's development and sustainable future. These include consolidation of carmakers to reduce the opportunity for overcapacity, as well as promoting innovation in the alternative fuel segment to provide new areas for investment and product development. Parts suppliers are undeterred by the threat of overcapacity, however, with major investment coming from TRW Automotive and Eaton Corp. As a safety systems supplier, TRW sees particular opportunities in the fallout from mass vehicle recalls.

China stays in second place in BMI's Business Environment Ratings for the autos sector in Asia Pacific with a score of 67.7 out of a possible 100. The market's highest scores are still for its production and sales growth potential, based on BMI's forecasts up to 2014, although we do expect a slowdown in growth. However, even though a low level of vehicle ownership can look tempting in terms of possible growth, the low score for country structure (caused by the large gap that exists between wealthy towns and poorer rural areas) acts as a clear restriction on potential penetration. In terms of China's macroeconomic environment, a healthy long-term political and economic outlook ensures strong scores for the country's risks to realisation of returns.

Competition in the world's largest car market is still strong, however, and BMI expects the battle between General Motors Company (GM) and Volkswagen (VW) to heat up as both announce their strategies for the country. VW will increase in its Chinese investment to EUR6bn (US$7.9bn) by 2011, up from the EUR4.4bn (US$5.8bn) originally announced in September 2009, which will fund two new production plants and seven new or upgraded model launches. GM is equally keen to gain some ground in China and plans to launch 25 new or revamped models by the end of 2011.

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Report Table of Contents:

CONTENTS
Executive Summary
SWOT Analysis
- China Autos Industry SWOT
- China Political SWOT
- China Economic SWOT
- China Business Environment SWOT
Business Environment Rankings
- Table: Business Environment Ratings -- Autos Industry Asia Pacific
Asia Pacific Regional Overview
Industry Forecast Scenario
- Production and Sales
- Table: China Autos Sector - Historical Data And Forecasts
- Trade
- Table: China Autos Sector - Historical Data And Forecasts
- Economic Contribution
- Table: China Autos Sector - Historical Data And Forecasts
Macroeconomic Forecast Scenario
- Table: China - Economic Activity, 2007-2014
Competitive Landscape
- Market Overview
- Industry Developments
- Production
- M&A Activity
- Table: China - Top 10 Passenger Car Brands, 2009
- Manufacturer Developments
- Table: Global Revenue By Premium Brand 2009 (EURmn)
- Commercial Segment
- Table: China - Commercial Vehicle Market (CBUs)
- Table: China - Commercial Vehicle Market Production (CBUs)
- Table: Commercial Vehicle Market - Top 10 Players, January-October 2008 (CBUs)
- Commercial Segment Developments
- Suppliers
Company Monitor
- Geely Strategy Supports BMI View
- Table: South Korea - Imported Luxury Vehicle Sales
Company Profile
- Shanghai General Motors
- Volkswagen
- Ford Motor
- Daimler
Country Snapshot: China Demographic Data
- Section 1: Population
- Table: Demographic Indicators, 2005-2030
- Table: Rural/Urban Breakdown, 2005-2030
- Section 2: Education And Healthcare
- Table: Education, 2002-2005
- Table: Vital Statistics, 2005-2030
- Section 3: Labour Market And Spending Power
- Table: Employment Indicators, 2001-2006
- Table: Consumer Expenditure, 2000-2012 (US$)
- Table: Average Annual Manufacturing Wages, 2005-2012
BMI Methodology
- How We Generate Our Industry Forecasts
- Sources

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