SUV Segment in China Remains Prosperous DNT

Total sales of SUVs had been 3.22 million units with a year-on-year rise of 45%in the Chinese market, from January to May in 2016, according to data from China Association of Automobile Manufacturers. Growth rate of SUVs in 2013 and 2016 was both larger than 50% while that in 2014 was 37.28%, leading to prosperity of the SUV segment in China.

However, factors including little difference among modes of SUVs, lack of analysis on customer demands and price war may cause fierce competition among automakers in China, even though the SUV segment overall will still thrive.

SUVs of Chinese brands have taken up larger market shares than before, leading to that gap between Chinese brands and joint brands has dropped to 3% in 2015 from 45% in 2013. And market shares accounted for by SUVs of Chinese brands may continue to increase in the following years.

Boom in the SUV segment has driven automakers to invest more on launch and production of SUVs. But lack of customer demand cause little difference among different modes of SUV, making it harder of automakers to take up larger market shares. Joint automakers has lowered price of their SUV products, which reportedly have high quality, having great threat to Chinese automakers.

Increasing customer demands ensure great room for sales of SUVs to grow in the following years. Combination of product of good quality, brand gaining high loyalty and great control in cost may decide which automakers may tower the others.