2008 Beijing Auto Show adds fuel to Chinese market

After a nine-day frenzy, the curtain finally came down on April 28 for the 10th China Beijing International Automotive Exhibition (2008 Beijing Auto Show, or Auto China 2008). The extravaganza showcased nearly 900 vehicles produced by various car makers from home and abroad. More than 600,000 visitors thronged to the event, which is expected to add fuel to China's fast-growing auto market.

This year's auto show boasts a record scale. A newly built exhibition center has been specially put into use. With a total area of 180,000 square meters of indoor and outdoor space, Auto China 2008 stands to become Asia's largest automotive exhibition, featuring 2,100 exhibitors from 18 countries and regions. A total of 890 models are on displayed, with seven global debuts and 24 Asian debuts. Nearly 100 new models have appeared at the show.

The large number of visitors suggests Chinese consumers' enthusiasm about cars. The last show in 2006 attracted over 600,000 visitors. This year, more have come to experience the hottest models.

One visitor said, "I am looking around. I am interested in buying a car at a price of about 1 million yuan, such as an Audi. And I'm also interested in a small Panda model for family shopping."

Another visitor said, "I already have a car. But I am considering a change to a better model. "

Another visitor said, "I am interested in a MPV at the price about 200,000 yuan. I hope it can be used for both business and family."

With demand slowing in major US, Japanese and European markets, global brands are looking to China, the world's second-largest auto market, to fuel growth.

General Motors, Ford and Volkswagen, among others, are showcasing their new designs at the show, hoping the booming market in China can drive up sales this year.

John Parker, Executive Vice President of Ford said, "The business is growing very strongly. We have an exciting product line up, and we've got brand new products behind me that we are launching in the Chinese market later this year."

Luxury brands such as Germany's BMW and Daimler's Mercedes division are also eyeing China's growing wealth to boost global demand for top-end vehicles.

BMW's China venture, Brilliance Auto, plans to nearly triple capacity in the next four years, aiming to produce around 100,000 vehicles a year by 2012.

The exhibition also offers 60,000 square meters for auto parts. For the first time, the auto china show is displaying PV, CV, auto part and after-market products in a single exhibition. 1,800 auto parts makers including well-known brands such as Botch, Michelin and Alpine are displaying their latest products and technology.

Just like international car makers, Chinese auto manufacturers are also taking the opportunities to show off their top-of-the-line models. With homegrown crossover, SUV, MPV and concept car versions now in display, Chinese brands are responding to foreign challenges.

Geely is showcasing its first sport utility vehicle, the NL-1, as well as the GC-1 mid-sized sedan, in a departure from the no-frills, entry-level cars they are best known for. The car maker plans to develop more than 40 models using 15 vehicle platforms by 2015.

Frank Zhao, Vice President of Geely said, "It's very positive you know, it's going to be double digits that's for sure. Whether it's 19 percent or 27 percent it is really hard to say. Why? Because the Chinese market is different from other markets. Because the average income of the majority of people is very similar that tells you when one guy is ready to buy a car then almost 1.2 billion people are ready to buy a car. That really something quite different from other markets."

The new trend is also suggested. A doubling of crude oil prices in the past couple of years has sparked a worldwide shift towards smaller, fuel-saving cars - a phenomenon that China is also embracing. Pollution in cities adds needs for clean vehicles.

Pivos2 is an innovation of Nissan. It is driven not by gasoline, but by a high volume compact lithium-ion battery. With compact and high output electricity technology, it is said to be both environmentally friendly and flexible. The cabin can rotate three hundred and sixty degrees, and can also move sideways.

Wu Weiren, Manager of Brand Promotion of Nissan said, "As the issues of energy, carbon dioxide emissions and environmental protection arouse more attention, China should also develop in large scale eco-friendly cars. We hope to introduce this kind of cars, and especially practical models to china market in the future."

After reaching nearly 8.8 million vehicles last year, the Chinese auto market is seen growing to 10 million units this year. Double-digit growth is expected to continue at least over the next five years, exceeding projected economic growth of 7-8 percent over the same period.

China's auto market has grown by between 20 to 30 percent over the past five years, a period of explosive growth. The frenzy of the auto show this year seems agree with what analysts say -- China is on the track to overtake the United States as the largest market for cars and trunks.