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Car Purchasing Process - China - September 2018

OVERVIEW
What you need to know
Covered in this report
Excluded
EXECUTIVE SUMMARY
The market
Figure 1: Best-and Worst-case forecast of total passenger car sales volume, China, 2013-23
Figure 2: Best-and worst-case forecast of basic passenger car sales volume, China, 2013-23
Figure 3: Best-and worst-case forecast of muv sales volume, China, 2013-23
Figure 4: Best-and worst-case forecast of suv sales volume, China, 2013-23
Companies and brands
Figure 5: Company brand market share in volume, 2015-17
The consumer
Figure 6: Types of car brands for planned purchase in the next 12 months, April 2018
Figure 7: Future car purchasing channels, April 2018
Figure 8: Car feature preference, April 2018 vs 2016
Figure 9: Car functions, April 2018
What we think
ISSUES AND INSIGHTS
KOL marketing in automotive industry
The facts
The implications
Figure 10: Advertisement of Volvo XC 40
Figure 11: Weibo of No.38 car review centre and Geely’s vice president repost
Figure 12: Monthly sales volume of Lynk 01
Dedicated into the brand
The facts
The implications
Figure 13: Lynk & Co centre
Being an expert on the car aftermarket
The facts
The implications
THE MARKET – WHAT YOU NEED TO KNOW
Cooling down for new passenger car market
Benefits are fading out
MARKET SIZE AND FORECAST
Winter is coming for new passenger car market
Figure 14: Sales volume and growth rate of total new passenger car market, 2013-18
Market expected to grow at a CAGR of 3.1% till 2023
Figure 15: Best-and Worst-case forecast of total passenger car sales volume, China, 2013-23
MARKET DRIVERS
Vehicle purchase tax discount ended in 2017
Government subsidy being phased out in  new energy car market
Growth speed slowing down in SUV market
Momentum of the second hand market affecting sales of new cars
Figure 16: Comparison of sales volume of second hand and new passenger cars, 2013-17
Consumers’ attitudes towards car hire
MARKET SEGMENTATION
Toughest year since 2013
Figure 17: Best-and worst-case forecast of basic passenger car sales volume, China, 2013-23
MUV market is expected to recover slowly from 2020
Figure 18: Best-and worst-case forecast of muv sales volume, China, 2013-23
Growth of SUV market slowed down significantly in 2017
Figure 19: Best-and worst-case forecast of suv sales volume, China, 2013-23
KEY PLAYERS – WHAT YOU NEED TO KNOW
Geely is the star in the top ten lists
Entering into the international market with innovations on the design
The innovation has gone further
MARKET SHARE
Top ten companies are gaining momentums
Figure 20: Company brand market share, 2015-17
American brands are losing market share
Geely is the shining star in 2017
COMPETITIVE STRATEGIES
Chinese brands step into international
Innovations on the in-car functions
Figure 21: Nio queen’s co-pilot seat
Figure 22: Byton’s adjustable car seats
Pushing the outside design of SUVs to a new level
Figure 23: 2019 Volkswagen Tiguan
Figure 24: Lynk 01
WHO’S INNOVATING?
Fuel cell car – think different in the era of new energy car
Figure 25: Hyundai Nexo fuel cell car
Aero Cars
Figure 26: AeroMobile 5.0 VTOL
Wireless charging from BMW
Figure 27: BMW wireless charging
THE CONSUMER – WHAT YOU NEED TO KNOW
Chinese brands’ ownership improved but German brands dominate future purchasing plan
Looking for better
Parking assistance is the buzz of the year but safety is still the priority for budget cars
CAR BRAND
German brands dominate consumers’ future car purchasing choices
Figure 28: Types of car brands for planned purchase in the next 12 months, April 2018
Chinese car brands surpass American brands as the third place in car ownership in 2018
Figure 29: Car brands ownership, April 2018 vs July 2017
German brand is expected to see more growth in the future
Figure 30: Brands ownerships vs future planned purchasing brands, April 2018
Potential core consumers of Chinese brand are aged from 25-29 and 40-49
Figure 31: Types of car brands for planned purchase – Chinese brands, by age, April 2018
American brands and Korean brands are preferred by young generations
Figure 32: Types of car brands for planned purchase - Korean brands, by gender and age, April 2018
German brands and Japanese brand find their niche market separately
Figure 33: Types of car brands for planned purchase – Germany and Japanese brands, by household income, April 2018
CAR MODELS
Top 20 models that consumers plan to buy
Figure 34: Car models that consumers plan to buy next, top 20, April 2018
Volkswagen dominates the top 20 model list
Figure 35: Car models that consumers plan to buy most, top 20, April 2018
CAR BUDGET
Small consumption upgrade in car price
Figure 36: The price range of car planned to purchase, April 2018 vs July 2017 vs July 2016
Figure 37: Average target price, 2015-18
Figure 38: The price range of car planning to purchase, by car owners and buyers, April 2018
Desirable price range by brands
Figure 39: The price range of car planned to purchase by brands against average, April 2018
FUTURE CAR PURCHASING CHANNELS
4S store is still consumers’ first choice to purchase their next vehicles
Figure 40: Future car purchasing channels, April 2018
More older males prefer 4S store, but younger females think out of the box
Figure 41: Future car purchasing channels, by gender and age, April 2018
Figure 42: Future car purchasing channels – automobile show, by gender and age, April 2018
Chinese brands need to improve 4S stores’ service
Figure 43: Future car purchasing channels, by car brands, April 2018
PREFERRED CAR FEATURES
The need for urban commuting is rising like never before
Figure 44: Car feature preference, April 2018 vs 2016
Different price range defines different features
Figure 45: Car feature preference against average, April 2018
DESIRED CAR FUNCTIONS
Parking assistance is the buzz of the year
Figure 46: Car functions, April 2018
Car functions by car brands
Figure 47: Car functions by car brands, April 2018
Safety should be prioritised in budget cars
Figure 48: Car functions against average among consumers whose budget is below RMB200,000, April 2018
AR/VR COMMERCIAL APPLICATIONS
AR beats VR as the most welcome commercial application
Figure 49: AR/VR Commercial applications, April 2018
Fast purchase decision-making process by AR/VR
Figure 50: AR/VR Commercial applications, April 2018
Enthusiasm from consumers for more AR/VR commercials
Figure 51: AR/VR Commercial applications, April 2018
AR/VR as the supplementary method for test drive
Figure 52: AR/VR Commercial applications, April 2018
MEET THE MINTROPOLITANS
Higher affordability for car price range
Figure 53: Car price by consumer classification, April 2018
Positive attitudes on AR/VR from Mintropolitans
Figure 54: AR/VR applications by consumer classification, April 2018
APPENDIX – MARKET SIZE AND FORECAST
Figure 55: Total sales volume of new passenger cars, 2013-23
APPENDIX – MARKET SEGMENTATION
Figure 56: Total sales volume of suvs, 2013-23
Figure 57: Total sales volume of muvs, 2013-23
Figure 58: Total sales volume of basic passenger cars, 2013-23
APPENDIX – METHODOLOGY AND ABBREVIATIONS
Methodology
Fan chart forecast
Abbreviations

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