MPVs to expect a boost in China

#hashtags: #China #SUVs

With the new relaxing one-child policy, the demand for mini-vans in China is expected to register an important revival, as more families will turn their attention toward multi-purpose vehicles. Chinese customers are in love with the SUVs, a segment where sales were boosted by 60.6 percent to more than 622,000 units in October. But the automakers believe that the focus will slightly shift towards mini-vans, as Chinese families will embrace this type of cars due to a more relaxed one-child policy. In October 2015, there were announced plans of the government to abolish the one-child policy, allowing all families to have two children “to improve the balanced development of the population.” Chinese authorities hope it will help boost the population to 1.45 billion by 2030 from 1.37 billion at the end of last year. As a proof of carmakers’ hopes, the multi-purpose vehicles were in the center of attention at the Guangzhou Auto Show, where Volkswagen AG presented a supersized version of its Touran and Guangzhou Automobile Group subsidiary GAC Motor showcased a prototype mini-van. At this moment, the MPVs account for 10 percent of passenger car sales in China, but the trend is showing an increase, as sales are growing at a faster pace than the entire auto market. “After the roll out of the two-child policy, I believe the market share of 7-seat SUVs and MPVs will further strengthen,” Wu Song, GAC Motor’s general manager, told Reuters. MPV sales for the first 10 months of the year grew 7.8 percent, according to the China Association of Automobile Manufacturers, outperforming the 1.5 percent growth in the overall car market. After years of high luxury and big cars demand in China, the automakers will have to adapt to the upcoming direction, as larger families will trade their sports utility vehicles for MPsV, taking into the consideration the fact there are restrictions in most major cities on owning a second car. Via Reuters