Himfr Analyzes China's Automobile Industry High-growth Factors

Jan 28, 2010, 10:00 ET from Himfr.com

BEIJING, Jan. 28 /PRNewswire-Asia/ -- Himfr.com, one of China's leading B2B search platforms with more than 30 B2B industry websites to its name, analyzes China's automobile industry high-growth factors.

As the global economy is facing a huge financial crisis, the impact on the Chinese automotive industry in 2009 was a welcome explosive growth. According to the Himfr's statistics, from March to November, car sales reached 12 million units. Car sales for 9 consecutive months passed 1 million units.

Himfr points out that in the post-financial crisis, the global economic climate has changed, and two factors will determine whether the auto industry in 2010 will maintain rapid growth.

Consumer Upgrades and Product Innovation

Increased income promotes consumption upgrade. After 20 years of rapid economic development, China's income level and spending power have improved significantly. In 2008 China's per capita GDP for the first time broke 3,000 U.S. dollars, reaching 3,266.8 U.S. dollars, or 22,698 RMB. With income growth, Chinese people began buying low-end appliances, such as television sets, radios, etc. in the 1980s-1990s, and now houses and cars are common products, and this consumption trend still continues.

Himfr's data show that in 2009, from January to August, private car ownership was 23.774 million units, compared with the same period of the prior year, increasing by 31.46 percent, private cars accounted for 81.89 percent. Among them, tier 2, 3 and 4 urban vehicle sales increased respectively by 32.5 percent, 47.2 percent and 48 percent, higher than tier 1 cities at 18.9 percent. From a market share point of view, the current new car market share of only 12.3 percent from tier 1 cities, and the non-tier 1 cities market share reached 87.7 percent. Compared to the urban market, which is relatively saturated, the traffic capacity declined while non-tier 1 cities have very broad market prospects, especially for some tier 3 or 4 cities, where car consumption is only just beginning.

As consumption increases, it will inevitably be accompanied by new car consumption patterns: new energy vehicles. The ever-increasing consumption of motor vehicles has become the most important area for oil consumption and its most important growth factor, showing a rising trend year by year. At present, China national petroleum motor fuel accounts for 60 percent of fuel consumption; energy tension has become new energy vehicles development drive factor. (http://www.himfr.com/list-product-Automobile-03000000-1.html )

Stimulus Policy Intensifies

If the increase in income and the drive to purchase cars increases are sufficient conditions to increase car demand, then the consumption environment will improve the whole market. The policy to stimulate consumption was an important factor for the 2009 automobile industry; Himfr expects that this trend will affect the 2010 auto market as well.

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SOURCE Himfr.com