China Revs Up… Displacement?
According to The Global Times, China’s burgeoning love affair with the automobile is maturing nicely: though sales have slowed in the Middle Kingdom, the engines are getting bigger.
In July, smaller cars accounted for only 65.38 percent of overall passenger vehicle sales, which totaled 946,200 units, declining 1.42 percentage points month-on-month and dropping below last year’s average of 69.5 percent for five months in a row.
“Small cars,” it should be pointed out, means cars with 1.6 liters displacement or less. This despite a 3,000 yuan ($443.37) government subsidy on 71 qualifying “small car” nameplates. And if an uncooperative market weren’t enough to cause some head-wagging in Beijing, only one Chinese-brand car made the China Association of Auto Manufacturers “ten best-selling sedans” list: the BYD F3. And no, not the plug-in hybrid version.
More by Edward Niedermeyer
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Prosperity begets one-up-manship. Didn't take too long to happen, but it's happening. People who can afford cars want the status conferred by having bigger, better cars. Sucks about the hybrid... but then, a lot of high-profile government-incentivizing for hybrids and electrics outside the US and Japan are failing. Gas prices aren't high enough anymore to cause the knee-jerk reaction needed to force regular customers to consider them, and the price premium for ownership is still too high, even with the incentives.
I'd say with 65% of the popular still opting for vehicles with 1.6 liters or less of displacement, the Greenies still have plenty to celebrate in China regarding vehicle choice vs the proper developed world. It's telling that the newly prosperous Chinese want nothing to do with Chinese cars for the most part. If it werent for China's anti-competitive JV restrictions it would finally be genuine cause for the west to celebrate China's newfound affluence.
Considering a 元3000 subsidy isn't moving small metal, I wonder if many millions of Chinese who may have the scratch to buy a car are in a wait-and-see mode, saving their money while the country sorts out its dire infrastructure problems. Owning a car is all well and good and getting a good deal even better, but it's all meaningless if you're stuck in crushing gridlock the moment you pull out the dealer lot. Then again, it may just be a matter of pride. Americans may be willing to snatch up Aveos and Rios, but perhaps Chinese prefer to get the best car they can, even if they need to shell out for it.