Premium car makers are confident of growth in China continuing a while yet even as overall market expansion slows.
Even conservative forecasts have the automobile market surging to 30mvehicles a year by 2020 from last year’s 18m and some think volume could even reach 40m, according to a Reuters report.
Go deeper with GlobalData
“We expect the premium segment to grow much more strongly than the overall market,” Audi sales chief Peter Schwarzenbauer said in an interview with the news agency.
“China has 304 cities with at least 1m population and we have so far only [established] dealers in 187 of them. The premium market still has extremely good growth prospects. We’re all still scratching the surface in China.”
“I don’t know whether this is the best moment to be launching or not, but it’s still the world’s biggest auto market,” Peugeot’s global marketing chief, Xavier Duchemin, told Reuters after unveiling a concept car preview of the DS line that launches in China in June with a 200,000 units a year target. “And premium is still the fastest growing segment.”
Duchemin was confident of finding enough investors for the DS sales network planned with local manufacturing partner Changan even as rising competitive pressure on prices and dealer margins makes the task “a little more difficult”.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataChina’s premium car market should grow 15-20% this year, Daimler chief executive Dieter Zetsche said, adding that Daimler’s sales should at least match that rate.
He also said he expected Mercedes-Benz to post a sales increase in Europe this year but did not elaborate.
General Motors expects sales of its Cadillac models in China to match US sales levels by 2015 or 2016, chief executive Dan Akerson told Reuters.
Cadillac sales in China grew 73% to over 30,000 last year and were up 20% in the first quarter. Last year, GM sold about 152,000 Cadillacs in the United States.
He added that the company planned to add one new Cadillac model in China each year to the end of 2016. The XTS luxury sedan will be built in Shanghai starting in the fourth quarter of this year, Akerson said.
BMW expects sales growth in China to climb by a double-digit percentage in 2012, sales chief Ian Robertson told the news agency, adding the company expected another record sales year worldwide.
“I expect the (Chinese premium) market to ease somewhat from the 30% or so last year, but there’s still a degree of upside in the market,” said Robertson.
“Forecasters say the premium segment in China could double over the next 4-5 years. We have about 290 BMW dealers now and will open about 50 more in the next 12 months. That also includes third-tier and fourth-tier cities.”
Audi saw first-quarter sales grow 10.8% and said that pace of growth was extending into April in China and globally.
Sales chief Schwarzenbauer said China should surpass the United States to become the world’s largest luxury car market by 2015 and he also saw opportunities in Europe despite the region’s economic woes.
“There are many markets in Europe that are developing well,” he told Reuters, citing Britain, Russia and Germany, that were offsetting struggling southern European markets. “I expect us to grow in Europe this year despite the headwinds.”
Nissan Motor CEO Carlos Ghosn tolf journalists some of its rivals’ recent success in China was due to price discounting, a factor he said was holding back Infiniti sales.
Ghosn said Infiniti grew 60% in 2011 but only 2% in the first three months of 2012, but added that Nissan would not join the discounting trend.
“The definition of a luxury brand is a brand for which you’re ready to pay a higher price for what it represents,” he said. “If you start to be a bargain, yes, you’re going to have a boost in sales in the short term but you’re going to lose the luxury halo after a while.”
