New car sales will hit 23m units this year as total vehicle fleet swells.
Chinese auto fleet continues to grow Image: Faungg |
Passenger vehicle sales will outpace economic growth this year as China may avoid slipping into a deep recession, predicts LMC Automotive.
The company forecasts passenger vehicle growth of 8% to 22.96m units, driven by strong demand for SUVs and a continuing sales tax incentive for small vehicles.
The Detroit-based consultancy sees commercial vehicles also enjoying a modest increase of 4% to 3.78m units during the same period.
However, rival consultancy IHS Automotive remains bearish on the Chinese market, suggesting growth of between 5-6% during the same period. Although government relief on sales tax for new cars has increased optimisim in the market, IHS believe that sustained stock market volatility will continue to ward off new car purchasers.
Meanwhile, China's total vehicle fleet swelled by 12% to over 172m units at the end of 2015, while the number of cities with more than 1m vehicles increased to 40 from 35 in 2014. Of those 40, 11 had fleets of more than 2m vehicles.