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Positive outlook for China's car market ahead of Shanghai Auto Show

Chinese automakers Geely, Great Wall Motors and BYD are expected to be joined by European brands Audi, BMW, Mercedes-Benz and Volkswagen and others at Shanghai's National Convention and Exhibition Center for the Shanghai Auto Show.

China, where the COVID-19 pandemic began in December 2019, became the first country to reopen its economy after the disease was declared under control in March 2020.

Auto analyst Zhou Lijun from expects China's auto market to maintain mild growth this year.

"I personally optimistically estimate that China's automobile export will see a blowout growth in the next five or six years," he says.

Automakers are looking to China, the first major economy to start recovering from the coronavirus pandemic, to drive sales growth and reverse multibillion-dollar losses from the pandemic.

Zhou says to do that, they must meet the more diversified and personalised demands of Chinese buyers.

"The Chinese market and users are undergoing dramatic changes," he says.

"And the Chinese strategies of these car companies are based on the market dominated by young families in the past, which obviously does not meet the needs of the rapidly growing middle-aged, women and single users."

Global and Chinese automakers are expected to display dozens of electric models in Shanghai, part of a race by the industry to meet Chinese government sales quotas imposed to promote the technology.

The Communist Party wants to make China a leader in electrics and has used subsidies and other support to transform it into the biggest EV market, accounting for almost half of global sales.

"Electric vehicles have a good development prospect in China. At present, the annual sales volume is only one million, and there is still a lot of room for growth in the future," says Zhou.

"But car companies must have a clear market positioning for electric vehicles. Who are they going to sell them to?"

The biennial Shanghai Auto Show will begin on Monday (19 April) with media previews and will run till 28 April.

The annual premier China auto show is held in Beijing and Shanghai on alternate years.

Last year's event in Beijing was postponed from April to September due to the pandemic.

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