China's vehicle market, which increased 54% in 2009 and which grew by another 33% in 2010, has been slowing down. During the first three months, vehicle sales even dropped. However, worldwide vehicle manufacturers are more aggressive than ever. They will shell out larger amounts of money and executive attention on the biggest market in the world.
Renault-Nissan CEO Carlos Ghosn noted that there is a forthcoming "tremendous growth." He stated that China is not "a source of worry." In the plans of worldwide vehicle manufacturers, the Chinese nation is booming, as shown on the various new assembly factories, new models and expanded dealer networks revealed at the Beijing automobile show.
Supporting the optimism are expectations that vehicle sales in the large cities of China are poised for takeoff. According to Audi's worldwide sales boss Peter Schwarzenbauer, the automaker is present in only 187 out of the 300 cities in China that have more than a million residents. He disclosed that the company is still "scratching the surface."
The consensus from Detroit to Wolfsburg to Tokyo is that China is still hot. However, the new normal will be a yearly market growth of 5% to 10%, and not the past double-digit rate.
This is just fine by most executives, who favor moderate yet steady growth rather than unpredictable valleys and peaks. Fiat Chrysler CEO Sergio Marchionne shared that the growth was "too much, too quickly." High gasoline prices, the expiration of government incentives and the slowing economy are some of the reasons cited for the current slow pace.