China Auto Market Continues COVID Rebound in Bright Spot in Global Auto Market
Chinese auto sales grew at least 8 percent year over year in October. This follows a 7.4% jump in September. October marked seven straight months of year over year growth in China. China’s growth stands in stark contrast to many other markets around the world, which continue to be thwarted by COVID cases.
So what is China’s secret?
China has not experienced the same spike in coronavirus cases seen in the rest of the world the last several months. In fact, China even held an auto show in September, one of few that proceeded in 2020.
China also has focused significant efforts and financial incentives on electric vehicles. As with the hopes for a green recovery by some in the auto industry, China extended expiring subsidies and tax break policies and investing in infrastructure. China has goals for 15% or more of the market in 2025, growing up to 50% within 10 years after. These incentives have worked, with NEVs growing 68% and setting records earlier in the fall.
In addition, high-end consumers in China have not been impacted as much by economic woes this year, increasing demand in the high-end segment.
Foreign automakers are taking note and pinning hopes on growth in Chinese auto sales to buoy weaker sales elsewhere in the world. A number of foreign automakers have made significant investments in China recently, and others are eyeing the market. Given China is several months ahead of other parts of the world on coronavirus controls, and other markets hope the recoveries of other markets likewise follow suit.
