After a 28m unit market and 14% growth in 2016, the China Association of Automobile Manufacturers (CAAM) has said it expects the vehicle market to slow to 5% growth in 2017.
Analysts says that the auto market will cool due to a higher purchase tax (after a temporary reduction last year) and a slowing Chinese economy. There will also likely be a ‘payback’ period of lower demand following a rush to buy cars in the final quarter of 2016 – a mini-boom that was encouraged by manufacturer and dealer incentives,
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According to Reuters, Volkswagen also expects the Chinese auto market to grow at around 5% in 2017.
A bright spot in the market is new energy vehicles, including EVs. Subsidies offered by the government will continue to be an incentive for buyers of new-energy vehicles.
CAAM said new-energy car sales grew by 53% last year to 507,000 units.
China New Energy Vehicle Report
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By GlobalDataThe Chinese government is expected to post quarterly economic growth figures tomorrow (January 20th) that will confirm slowing economic growth of around 6.7% – on an annualised basis.
