Being the most populous nation on Earth, China’s rapidly growing middle and upper classes are easily outnumbering the entire population of most other nations. Thanks to China’s economic success story, these affluent strata of Chinese society also have disposable income that outnumbers the GDP of some nations – and they are definitely spending it. Currently, Chinese consumerism has fixed on one major product as the marker and symbol of newfound affluence. In today’s China, that product is the automobile.
As a result of infrastructural developments and continuing urbanization over the last decade the Chinese population has gone car crazy. The Chinese car market, 15 years ago merely a niche market for western car manufacturers, already exceeds U.S. market sales by 6.5 million units a year (22 million vs. 15.5 million) and is expected to continue to grow equally rapidly as the Chinese economy as a whole. But Chinese car buyers are especially intrigued by the lure of luxury vehicles. A look at the luxury segment reveals that sales in China have increased by 36%, compared with a 26% gain in the overall car market.
As a premium auto market, China has been and will continue to be a growing opportunity for the world’s auto makers. Estimates show that by 2020 luxury car sales in China will top 3 million units (or 40% of the global market) per year. The projections indicate a growth rate upward of 100% and indicate that China will surpass luxury sales in both the U.S. as well as in Western Europe. Current numbers clearly support these projections:
- Audi reports selling 124,520 units in China in the first three months of 2014 – enough to account for 33% of global sales.
- Mercedes’ S-Class sedan sales have doubled, and 25% of all sales were made in China.
- China is now the #1 market for Tata’s Jaguar and the main reason for Jaguar’s 74% sales increase in 2012.
- BMW’s 2013 sales in China increased by 19% to over 360,000 units, surpassing the U.S. as BMW’s largest market.
As the numbers clearly show, China’s luxury car market is growing at an almost insatiable pace. Unfortunately, with this growth opportunity come opportunists who are willing to price gouge. Recently, numerous news reports have surfaced that cover businesses which, taking advantage of lax customs enforcement, purchase luxury vehicles domestically for $55,000-75,000 and then export them to China, where they will be sold for up to three times the original price. Aside the price gouging issue, there are also increasing reports on import infractions and ownership infringements. From the United States alone, where the practice incurs a civil penalty, an estimated 35,000 vehicles are believed to have been exported illegally to China.
So what can be done to capitalize on the continually growing Chinese market, without restricting trade or potentially stifling demand? Though stricter import law enforcement is required, for luxury car companies it is crucial to enter the Chinese market effectively and grow their customer base continually. Don’t let your competitors take advantage while you are missing out. EVS Translations is an international translation company with seven offices around the globe. Regardless of whether your company is an automobile manufacturer, supplier or an advertising agency representing European and U.S. clients in China, EVS Translations can help you achieve your goals. Industry specialists at EVS Translations have the skills to ensure that even the most complex and challenging texts are accurately translated into simplified or traditional Chinese and Mandarin.
In-house teams of experienced professionals routinely translate technical data sheets, marketing campaigns, design drawings, maintenance manuals and similar documents.
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