Road ahead for the world's largest auto market

SHANGHAI - Seventy-five percent of Chinese consumers prefer to buy a green car versus their dream car, and eleven percent plan to buy a new car in the next twelve months, according to a recent survey conducted by global market research company Synovate.

Synovate surveyed more than 13,500 people across 18 markets about vehicle ownership, intentions to buy in the next year, and attitudes towards cars, traffic, public transport and ‘green’ versus ‘dream’ cars.

Preference for Green

If money were no object, 53% of people in China would buy a green car and 25% said they would buy their dream car. A further 22% indicated that their dream car is a green car, with more females (25%) showing this preference than males (19%). This also means 75% of urban Chinese desire an environmentally friendly automobile.

“This is not a surprising result for China,” says CEO of Synovate China, Darryl Andrew. “Last year’s Olympic Games really highlighted issues with China’s air quality, plus the Government has made concessions for both green car manufacturers and the people who choose to buy and drive them. In fact there is RMB10 billion (approx US$1.5 billion) up for grabs for investment in manufacturing greener cars.

“This has an impact on car manufacturers globally with more focus on the needs of the Chinese consumers. We‘ve seen this with the surge in displays at the recent Shanghai Automotive Show and with the magnitude of product displayed by the local manufacturers. In Q1 alone, cars with smaller engines are estimated to make up 60% to 70% of sales.”

The survey also revealed that Chinese consumers not only want a green car, but also something that will turn heads. Fifty-eight percent of people indicated they prefer an attractive vehicle.

For car manufacturers, these are good indicators that the next generation of car design should be both green and stylish.

Comments Synovate’s CEO of Motorsesearch, Scott Miller: “We cannot forget that cars are the ultimate product when it comes to an emotional connection with people. What you drive says more about you than you think. There will always be a group of people who do not want to compromise on dream cars for green reasons. The answer? The 22% who want both are the way of the future. Car makers will produce vehicles that are dream and green.”

The meaning of automobile ownership

Urban Chinese expressed the importance of having an automobile. One-third of respondents say owning a car or motorcycle makes life easier for them, 73% believe automobiles are not a waste of money, and 65% admit that it is worth paying for the cost of running a vehicle.

So in the eyes of the Chinese consumers, is a car or motorcycle a functional or luxury good? The findings may be a surprise. Thirty-seven percent indicate that an automobile simply gets them from one place to another and only 10% of people think a car or a motorcycle is a luxury.

“Car ownership is becoming a common trend in China. The level of sales is 20-25% higher year on year. Especially with the incentive program put in place by the government to encourage purchase of alternative fuel cars such as hybrid, electric and fuel cell vehicles, we will continue to see more cars on the road,” adds Darryl Andrew.

The Road Ahead

This year has seen a boom in growth for China automobile sales with confirmed figures surpassing that of the United States in the first two quarters of 2009.

Synovate’s Darryl Andrew says there is still more work to be done. “Chinese consumers are very discerning, perhaps even more so than their western counterparts. With so many auto brands and sub-brands in the market, manufacturers and authorized dealers should keep top of mind that message cut through is important. Testing of ads should be done more frequently, to ensure that a strong brand image is established in the hearts and minds of consumers.

“Furthermore, manufacturers should take a holistic view of their marketing strategy. Online advertising and communities are becoming more important. Consumers are checking websites not just in China but abroad, making sure that the car models they get here are the same (or better) than what is available in the West. Having good information available online is very important.

“If, under the current economic climate, the intention to purchase a vehicle is expressed by 11% of the consumers, think of what it will be like once the economy is better. Auto brands should take this opportunity to build up their total customer experience. The road ahead is looking bright and lush.”

About Synovate

Synovate, the market research arm of Aegis Group plc, generates consumer insights that drive competitive marketing solutions. The network provides clients with cohesive global support and a comprehensive suite of research solutions. Synovate employs over 6,700 staff across 62 countries.