Shanghai January 4 (Gasgoo.com) The growth rate of the Chinese automotive market will slow down to 15 percent in 2011, and down further to 8 percent in 2005, First Financial Daily reported Tuesday, according to Roland Berger, a Germany-based market consultancy.
Roland Berger pointed out in its recent report "Chinese automotive market: How long will the party last?" that private vehicle sales in China will exceed 11 million units this year. China's private vehicle market, which has experienced tremendous development in the past ten years, witnessed strong annual growth of 35 percent from 2011 to 2007, mainly driven by booming sales of private vehicles that rose by 50 percent in 2008 helped by government incentives. And international auto companies also benefited greatly in the process, for instance, the European auto parts suppliers gained 20 percent of its total revenues from China last year.
Aside from that, Roland Berger predicted that private vehicle sales in China will exceed 18.7 million units per year by 2015 from an estimated 11.6 million units this year.
The growth is unsustainable however, because the long-time dependence on the government stimulus plans has increased the imbalance of China's economy, although it is still expected to grow considerably over the next few years. Significant challenges, such as currency appreciation, the end of stimulus programs, tighter monetary policy, unemployment and rising labor costs, will still likely limit it.
In addition, Roland Berger expected that China's GDP growth will stand at 8.1 percent in 2011, and fall to 7.5 percent in 2015. The growth in China's automotive market will go down to 15 percent in 2012 and 10 percent in 2012.
The forecasts by Roland Berger are similar to those by most executives at Chinese auto manufacturers. Dongfeng Nissan Deputy General Manager Ren Yong said China's auto market will grow 15 percent at most in 2011,and Chery sales company General Manager Ma Deji also said the growth rate of China's auto market will be higher than 15 percent this year.
China will extend subsidies to buyers of fuel-efficient cars this year but will no longer provide hand-outs to farmers who trade in fuel-guzzling models for new ones, the finance ministry said on Friday, according to a report from Reuters.
