Will China's auto market get warm in winter?

Shanghai, September 24 (Gasgoo.com) Starting September 20, Beijing lifted its even-odd plate license restrictions imposed for two months on the capital city's vehicle driving during the Olympic season, and some new policy to stimulate the future auto market is in the pipeline. All this gives China's carmakers, who are suffering from a market slump, a chance for heaving a sigh of relief and a hope of having a warm winter in the months ahead.

Last week, a deputy general manager of Shanghai GM admitted online that his company had not fulfilled the sales target for the first half of this year. Actually, SAIC convened a meeting of its executives and major dealers one month ago in Jinggangshan Mountain, Mao's early revolutionary base in southern province of Jiangxi, to work out proactive measures for weathering the imminent "cold winter" in the auto market. SAIC, as China's defending champion of auto sales, has resorted to the revolutionary mantra and strategy of Mao Zedong for quick resiliency from the market slump.

Shanghai GM is not alone in feeling the pinch of the auto market chill. Nearly all Chinese auto-makers, from FAW-VW to Chery Auto, saw their sales volumes diving in August, a month when the country's auto sales dropped sharply from both one year and one month earlier for the first time in the past four years. Many companies have correspondently adjusted their sales targets, management, and product lineup. All their shortcomings have surfaced out of the chilly water.

By the end of August, the nadir of car sales in China, many carmakers finished the adjustment of their vehicle ranges for the specific auto segments, waiting for a change for the better in the market and policy. But the cloud of pessimism about the near future’s auto market is still hanging over the market, and the new policy to come is not made clear yet, which may have led many prospective buyers to play the waiting game and delay their purchase of cars.

All sales executives and managers of car-making companies entered the month of September in mixed anticipation. They have got new vehicle models launched, prices cut, strategies changed just to wait for the encouraging policy and hungry customers to come soon, and for the market to have a "gush" -- a sharp strong rise in sales!

But the market has failed their daydream. The sales "gush" has not occurred yet this month as expected. However, the market has not thrust car makers and sellers into the depths of despair, either. They have seen a glimmer of hope drawing near: in the second week of this month, the auto market got a bit warm, with more and more customers swarming to the 4S stores of carmakers.

The recent lifting of Beijing's even-odd traffic regulations has sent another positive signal to the Chinese auto market, and the uplifting move will be possibly followed up by further favorable policy intended to reverse the market slump, making carmakers and sellers hopeful and profitable in the coming months.

It remains to be seen whether China's car market will enter a warm winter this year. Anyway, it is time for carmakers to adapt themselves to the gradual positive change in the market and to know more about its demands, rather than only dreaming of an unlikely "gush" of their sales.