Despite a slowdown in growth rate, the Chinese new car market will grow by 66 percent in 7 years.
Three years ago, China became the world's biggest car market in sales. That isn't going to change anytime soon, even with the slowing of the Chinese economy. Therefore, J.D. Powers is now predicting sales of 30 million cars in China by 2018, up from 18 million cars last year that, in relative terms, was a poor year. The Chinese market grew by just 5 percent, though this year analysts are expecting 10 percent growth. The growth decline is attributed to the cancellation of tax incentives for small cars.
In addition, there are restrictions on license plates in the heavily congested mega-cities. Geoff Broderick, a J.D. Power analyst, told blogs.wsj.com that growth is expected in second and third tier Chinese towns, mainly toward the west of the country where the standard of living is improving.Income is expected to rise, but car ownership is low and there is no restriction on license plates. "We're bullish on China," Mr. Broderick said. "The whole center of gravity in the global auto market has shifted from the West to the East, and this (China) is where we're going to see action, at least over the next several years."