China’s auto sales likely to stand at 25 mln units in 2020, Minister of MIIT

Shanghai (Gasgoo)-Both auto outputs and sales in China are likely to stand at roughly 25 million units in 2020, remaining flat or slightly dropping compared to 2019, Miao Wei, the Minister of China's Ministry of Industry and Information Technology (MIIT), said at a press conference held by the State Council Information Office on January 20.

The expectation was made based on a common prediction offered by some key automotive enterprises, who generally regarded the year of 2020 and 2021 are critical to stabilizing the auto industry and laying a solid foundation.

In 2019, China's auto outputs and sales fell 7.5% and 8.2% respectively, according to the China Association of Automobile Manufacturers (CAAM), representing downturn for the second year in a row. However, the decrease in auto outputs and sales was being continuously contracted during the second-half of 2019 thanks to companies' orderly adjustment and gradual execution of some policies issued to inspirit consumption, said Miao Wei, pointing out that the outputs growth became positive in November and consumers have been somewhat rebuilt their confidence over the market.

Mr. Miao stated the biggest problems vexing the current automotive industry are such long-term issues as the insufficient investment in the automotive infrastructure R&D, the lack of some disruptive technologies and immature innovation capability. In the meantime, the industry is also facing short-term challenges caused by factors like NEV subsidy phase-out and stricter requirements over fuel-burning vehicles' emission.

As the whole industry is still saddled with relatively high downward pressure, the government should do a better top-level policy design. Apart from thoroughly carrying out the Plan for the Middle and Long-term Development of the Automobile Industry issued in 2017, authorities should formulate and release the plan for the NEV industry development targeting the period between 2021 and 2035, to firmly promote the innovation and high-quality development of NEV industry under the sweeping trends of electrification, connectivity, intelligence and sharing.

Besides, relevant governmental departments should jointly research the policies for boosting auto consumption, and further study on and evaluate NEV subsidy policies. Miao also added the policies about promoting used car transaction and encouraging the expansion into rural markets will be researched simultaneously.

Moreover, a strategy for greater openness that integrates moves to bring in outside resources with the drive to go global should be highlighted as well. The domestic and foreign companies should be treated fairly, according to Miao's statement.