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Ministry of Industry and Information Technology: The automotive market is experiencing a downturn, but there are still three major positive factors
2024-05-15

There are many positive factors for the development of China's automotive industry: firstly, the concentration of the automotive industry is further increasing, with the top ten companies in sales ranking accounting for nearly 90% of the total sales. Secondly, the growth of the automotive industry's main business revenue was higher than the growth rate of production and sales. In the first eight months, the industry's main business revenue increased by 8.8% year-on-year, indicating that the industry as a whole is relatively healthy. Thirdly, new energy vehicles have maintained a good development momentum.
This year, the overall growth rate of the automotive market has slowed down, with a cumulative sales volume of 20.49 million vehicles in the first three quarters, a year-on-year growth rate of only 1.5%. The year-on-year growth rate of sales in July, August, and September has continued to decline, with a sales decline of 11.6% in September. Has the winter of the automotive market arrived? On October 23rd, at a press conference held by the State Council Information Office, Vice Minister of Industry and Information Technology Xin Guobin talked about this phenomenon, stating that low-speed growth may become the norm in the automotive market, but the overall development of the automotive industry is healthy.

Xin Guobin explained that the current growth rate of car sales has made everyone quite conflicted, hoping that the growth rate can be faster, but the reality is more "bone feeling". Not only is the growth rate not high, especially in the past three months, there have been consecutive negative year-on-year growth. He believes that the reasons for the slowdown in car sales growth are multifaceted and normal.
The production and sales base of automobiles in China is already very large, reaching a scale of 29.4 million units in 2017. It is difficult to achieve sustained high-speed growth on this base. From the current situation, the period of rapid growth in production and sales may have passed, and low growth is likely to be the norm for future development.
However, Xin Guobin believes that there are many positive factors in the development of China's automotive industry: firstly, the concentration of the automotive industry is further increasing, with the top ten companies in sales ranking accounting for nearly 90% of the total sales. Secondly, the growth of the automotive industry's main business revenue was higher than the growth rate of production and sales. In the first eight months, the industry's main business revenue increased by 8.8% year-on-year, indicating that the industry as a whole is relatively healthy. Thirdly, new energy vehicles have maintained a good development momentum. In the first three quarters, the production and sales of new energy vehicles reached 735000 and 721000 respectively, with year-on-year growth rates of 73% and 81%.
In addition, Xin Guobin also stated that considering the large amount of scrapped and replaced old cars in China, and the high demand in some small towns in the third and fourth tier, the growth space of the automotive market in the future is relatively broad, but it will definitely not grow at the same high speed as in the past.

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