You may not be surprised to hear that China, with the world’s largest population of 1.35 billion, also happens to have the world’s largest car market. But you may be surprised to learn which brands are popular among Chinese car buyers. As it turns out, Chinese buyers are drawn to American-made vehicles due to their luxury appeal and prestige. With rising interest in American-made vehicles, companies such as Ford are now opening larger markets in China and Chinese car manufacturers such as Shanghai-based SAIC are suffering.
In 2012, 19.27 million automobiles were made in China, far more than in the U.S. However, despite China’s growing auto industry, its reputation in the West isn’t very positive. In fact, in the early 2000’s, China’s automobiles were known to have low safety standards and perform poorly in crash tests. Though their redesigns cut costs and made up for many setbacks, Chinese car makers had already made a negative impression. American vehicles, with a far better track record for performance and safety, are trickling into the blooming Chinese auto-market with high hopes. In fact, Ford is attempting to double their share in the Chinese market by introducing new cars that might catch the eyes of Chinese buyers. After all, the Chinese economy has flourished and now, more than ever, people are earning enough to splurge on vehicles.
It’s not just manufacturers that are reaping the rewards. Kelley Blue Book (KBB), known as one of the most prominent automotive pricing and data providers in the United States, has drawn the attention of the Chinese auto market in hopes of increasing domestic car sales. KBB offers valuable information for buyers and allows them to compare vehicles, search for dealerships, and estimate prices. And, in order to introduce and implement these services, KBB is filing a joint venture with Bitauto Holdings Limited, a Chinese marketing firm.
With KBB’s entry into the Chinese market, the search for a company to organize demand within the increasing used-car market in China is now over. In addition, China hopes to continue its joint-ventures with U.S. companies in order to learn from global competition and increase domestic sales. Hopefully, this increased circulation of information and expertise will help buyers make educated decisions and stimulate the Chinese and American economies.
To learn more about the automotive market in China, you should check out ‘China Car Times’, which features photos of the newest models, updates on progress and presence in the market, as well as user commentary.
If you’re interested in global finance and marketing, international business studies or marketing may be for you. Baruch offers courses such as: New Product Planning and Development, Buyer Behavior, Marketing Strategy, International Economics and Finance, and International Markets, Cultures, and Institutions.