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The auto industry prepares for China’s ‘new normal’

The auto industry prepares for China's 'new normal'

Approach any automotive industry executive, analyst or economist, and they will say that China’s current decline in new vehicle sales is either a crisis or merely a bump in the road. What there is for certain is uncertainty. China’s car market, until recently the source of up to 30% of global car sales and around 40% of some OEMs’ global operating profits, has now been in decline for three consecutive months, and the downwardly restated targets for 2015 already look ambitious.

A slowdown in previously spectacular sales volumes was inevitable, but it’s the speed of that slowdown which has taken many by surprise, and has led to the government cutting its sales tax on small cars and easing car financing conditions.

Alongside falling sales runs the unwelcome additional danger of rising overcapacity, as OEMs continue to build factories commissioned during better times.

This Automotive World report is based on exclusive insight from OEM and supplier executives and the views of industry analysts and consultants.

Table of contents

  • Introduction – China’s ‘new normal’
  • August 2015: surprise yuan devaluation
  • The new normal, or a bump in the road?
  • China still has great potential
  • For growth, ‘Go West’
  • Adjusting to the new normal
  • Time for the domestics?
  • Closing thoughts – China continues to emerge

Insight and exclusive comments from:

  • Dr Dieter Zetsche, Chief Executive, Daimler and Head of Mercedes-Benz Cars
  • Nigel Stein, Chief Executive, GKN plc
  • Michael Cole, Chief Operating Officer, Kia Motors Europe
  • Trevor Mann, Chief Performance Officer, Nissan Motor Company
  • Automotive Reports
  • BMI Research
  • Frost & Sullivan
  • KPMG