Without any doubt, 2006 was a wonderful year for
China's automobile industry. At the beginning of 2006, the main Chinese automobile associations and institutes had forecasted that the output and sales of
automotive units for the year would be around 6.4 million. By the end of 2006, however, these two respective figures totaled 7.28 million and 7.22 million units. Thus, actual performance exceeded expectations by about 800,000 units. According to the most recent data,
China has now become the No. 3 and No. 2 automobile market in the world, ranked respectively in terms of annual output and domestic sales of new vehicles.
Compared to the current major world automobile markets in the EU,
Japan and USA,
China's automobile market experienced a high growth period in the past year.
China's excellent performance was not only outstanding on a world level, but also contributed significantly to the development of the world's automobile markets. Due to the boom situation in
China, the world's most famous automobile manufacturers are now active in the domestic Chinese market. One of the most important consequences of this is that the spirit of research and innovation in
China has received a timely boost.
Entering the twenty-first century,
China's automobile industry and
consumption market both saw rapid expansion. In 2001, the
consumption of new vehicles in
China was just 4.3 percent of total new vehicle
consumption in the world. However, after five years, this ratio has increased to over 10 percent. In other words, one of every ten vehicles sold in the world is now sold in the Chinese market.
The basic reasons for the rapid development of the automobile market in
China are to be found in the increase in the average person's disposable income, in people's desire for a better standard of living, in the continuous price drops due to the fierce competition between manufacturers, and due to the attractive, innovative designs of the automobiles on the market. In fact, of the 7.2 million plus vehicle units sold in 2006, private cars accounted for more than half of the total amount, almost reaching the figure of 3.85 million units. The purchase of family cars by the Chinese constituted most of this figure.
This trend has become more obvious in the last one to two months for a new reason. Due to the incredible prosperity seen in
China's stock market in 2006, many ordinary people earned very handsome profits by investing in stocks and shares of various companies. In 2006, some private capital
investments even increased by as much as 100-170 percent. Buoyed up this unexpected financial windfall, many families were finally able to fulfil their cherished dream of purchasing a private car. The latest data indicate that sales of private cars have increased sharply in many cities since last December. It is believed that this trend will continue at least until
China's New Year, i.e., until late February.
Furthermore, due to the general abolishment of various discriminatory and restrictive measures in
China targeting low-performance cars, people's enthusiasm for car purchases has increased. According to the latest reports, the cars registering the best sales are all low-performance vehicles. People choose them principally for the outstanding advantage of fuel economy.
It is widely forecasted that the year-on-year growth rate in
China's sales of new
automotive vehicles will reach 13-18 percent in 2007. Therefore, it may be said that the strong domestic demand in
China for automobile steel seems destined to continue long into the future.