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Customer LoginsSame-Day Analysis: GM, Toyota, Nissan, Geely, Great Wall report growth in Chinese sales in 2015
International and local automakers have begun to release 2015 data with positive gains, although the growth is not shared across the industry.
IHS Automotive perspective
- Significance: Sales in 2015 were not easy, and prior to the government introducing the stimulus in October 2015 the market had begun contracting, sending shockwaves through the industry and cutting forecasts - but from October 2015 onwards the final few months boosted sales enough to bring growth to a number of companies.
- Implications: Local Chinese automakers such as Geely and Great Wall have continued to experience growth in their home market in 2015, a trend they will now have to work hard to maintain as international original equipment manufacturers are bringing in better products to gain traction.
- Outlook: The light vehicle market in China is anticipated to grow to over 29.55 million unit sales per annum in 2020 - this huge volume will continue to encourage automakers to pull out all the stops to maintain and grow market share in China, although the market will experience cooler growth rates than seen in previous years.
General Motors (GM) and its joint ventures (JV) in China have sold 3,612,635 units in 2015 marking an annual increase of 5.2% year on year (y/y), the automaker has said in a statement sent directly to IHS Automotive. China remains GM's largest single-sales market in terms of annual retail sales.
"We expect to have increased our market share in 2015 through great products and our team's relentless effort," said GM executive vice-president and president of GM China Matt Tsien.
The sport utility vehicle (SUV) segment accounted for considerable growth for GM in China last year with a total of around 470,000 units sold in 2015, or 13% of the total retail sales in China. In 2014, the SUV segment accounted for only 5.6% of GM's total sales in China that year. The two SUVs that helped GM's growth were the new models - the Buick Envision and the Baojun 560.
Meanwhile, the multi-purpose vehicles (MPVs) - the Buick GL8 and the Baojun 730 helped push the MPV growth rate for GM to 12% y/y in 2015.
However, the top selling brand in terms of volume sales remains the Wuling, which is produced at the SAIC-GM-Wuling (SGMW) JV and is not technically a GM brand. Despite sales dropping 7.5% y/y, the Wuling brand sold over 1.4 million units in 2015. GM says continued contraction of the mini-commercial vehicle market affected the brand.
Buick was the second-largest brand in terms of volume sales with a total 989,167 units sold in 2015, up 12% y/y. The Chevrolet brand was next with sales of 612,024 units, an annual decline of 9.7% y/y.
The Baojun brand, a JV brand produced at the SGMW venture, sold a total of 463,532 units marking an annual increase of 173% y/y. The Cadillac brand sold 79,779 in 2015 marking an increase of 17% y/y. The ATS and ATS-L experienced sales of 30,752 units, up 172% from the previous year.
The Cadillac luxury brand set a record for domestic sales, as demand increased 17 % from 2014 to 79,779 units. The ATS and ATS-L experienced sales of 30,752 units, up 172% from the previous year.
Nissan has sold a total of 1,250,100 vehicles in China in 2015, marking an increase of 6.3% y/y, the automaker has said in a statement sent directly to IHS Automotive. Of this, the Dongfeng Nissan Passenger Vehicle Company, a JV between Dongfeng and Nissan, sold a total of 1,020,700 units marking an annual increase of 12.5% y/y.
Nissan's annual sales target for the Dongfeng Nissan JV was 1 million units. The automaker has therefore achieved its target.
December 2015 marked the best ever monthly sales for Nissan with 159,100 units sold, of which the Dongfeng Nissan JV sold 136,700 units, up 18.2% y/y.
The vehicles mainly responsible for helping Nissan achieve its target are the new models released in 2015 - the all-new Lannia and the Qashqai released in October 2015. Meanwhile, the Sylphy series accounted for sales of 350,004 units while the Venucia line of vehicles sold 122,056 units in 2015 in China.
Nissan has yet to release its 2016 sales target. Company spokesperson Joyce Wang says, "We are still studying the total industry volume (TIV) and various factors around the market, and will announce our target at [the] right timing."
Toyota has, together with its JV partners, in China sold a total of 1,122,500 units in 2015, marking an 8.7% y/y increase, the automaker has said in a statement. For 2016 the automaker aims for 1.15 million unit sales in China. The company has not yet released further breakdown of its sales data. Honda has also achieved its target for 2015, selling over 1 million units .
Geely has sold a total of 509,863 units in 2015, marking an annual increase of 22% y/y, the automaker has said in a statement filed to the Hong Kong Stock Exchange (HKSE). The Chinese automaker states that sales in December dropped 2% y/y to 53,633 units - although domestic sales within China rose 6% y/y in the month with 52,821 units sold. The company's exports continued to slide with just 812 units exported in December, marking an annual decline of 84% y/y.
In the final month of 2015, sales of the EC7 and the New Emgrand dropped, experiencing total sales of 23,491 units, down 9% y/y; but the Vision sedan and the car's newer version hit 13,189 units, up 56% y/y. The B segment GC9 sedan sold 5,504 units, up 1%. Meanwhile, the SUVs, which include the GX7, SX7, and the GX9, sold 5,139 units, maintaining similar levels to that sold in the same month in 2014.
But Geely remains positive for 2016 and targets sales of 600,000 units, an 18% y/y increase. The company succeeded in reaching its 2015 sales target of 450,000 units.
Great Wall has sold a total of 852,693 units in 2015, marking an annual increase of 16.68% y/y, the automaker has said in a statement issued to the HKSE. The company sold 730,772 units in 2014. However, exports continue to plummet for Great Wall with total exports down 52.36% y/y to just 23,007 vehicles exported in 2015, down from 48,292 in 2014.
The top-selling models for Great Wall continue to be the company's SUVs which together accounted for sales of 699,048 units in 2015, or 81.98% of the automaker's total sales. The SUVs total sales rose 34.58% y/y in 2015, of this the best-selling model was the Haval H6 with total sales of 373,229 units, up 18.17% y/y.
However, Great Wall's sedans continue to witness disastrous sales, with total volume plummeting 41.77% y/y with 54,178 units sold in the year.
Great Wall targeted sales of 850,000 units in 2015, a target it has achieved. For 2016 the automaker aims for total sales of 950,000 units.
Outlook and implications
The 2015 year was not pleasant for all players in China, with the market suffering significantly in the summer months, and the South Korean duo have already announced that they missed their sales target.
GM is expanding its line-up and anticipates stronger sales in 2016 in China. "We anticipate continued growth in 2016, as we plan to introduce 13 new and refreshed models starting with Cadillac's all-new CT6 sedan later this month," Tsien said.
In 2015, GM and its JVs expanded their line-up. They introduced 12 new and refreshed models, including the all-new Buick Excelle GT sedan and Verano new-generation sports sedan, new Chevrolet Malibu mid-size sedan, Baojun 560 SUV, and new Cadillac ATS-L luxury sport sedan.
GM continued growing its manufacturing presence as well. SAIC-GM opened its new Wuhan Branch and SGMW started production at the second phase of its Baojun plant in Liuzhou. On 5 November, a groundbreaking ceremony was held in Shanghai for the new engineering centre operated by the Pan Asia Technical Automotive Center (PATAC).
But almost all automakers are expanding their line-ups in China in a bid to gain traction in a market that once experienced strong double-digit growth rates, but which has now cooled to and expects to remain in single-digit growth- boosted by local government initiatives to encourage sales and prop up the market.
The car market in China has bounced back from the doldrums of July 2015, which was the result of a major dealer destock in China. The 'quick fix' remedy from the Chinese government with the reduction in the purchase tax for new small engine cars has lifted sales prospects for the passenger vehicle (PV) market in China. Sales in October 2015 rose faster than in the preceding 10 months, and November sales experienced the largest monthly gain since November 2013.
Momentum is expected to have built up towards the end of the year, and with the Lunar New Year in February 2016, automakers and dealers are increasing discounts and other offers while dealers are significantly replenishing stock. As dealers strengthen stocks ahead of the festive and peak sales season in China, IHS has mildly upgraded our forecast by around 365,000 units to reflect a 3.7% y/y growth rate for light vehicles in 2015. Total light vehicle sales for 2015 are now expected to hit 23.97 million units, of which PV sales are forecast to rise 6.7% y/y to 19.25 million units. This is significantly higher than our previous forecast for PV sales, which we to rise 4.3% y/y last year.
The overall light vehicle market in China is anticipated to grow to over 29.55 million unit-per-annum sales by 2020. International and local automakers will continue to fight to gain further segment shares in China as, despite slower growth seen in recent years, the Chinese car market maintains huge volume sales.
The year 2015 has been complicated for a number of automakers with the overall market suffering a major downturn in the summer months, and the government quickly stepping in to reduce the impact of a contracting market. The sheer size of the car market in China makes it an important pillar market for the entire economy. The current government stimulus, which allows for a 50% discount of the 10% new car purchase tax for vehicles with 1.6 litre engines and smaller, is expected to remain in place for 2016 and will likely help propel sales in the market - with automakers therefore strengthening their offerings of smaller engines coupled with turbo chargers.
About this article
The above article is from IHS Automotive Same-Day Analysis of automotive news, events and trends, and is a deliverable of the World Markets Automotive Service. The service averages thirty stories per day and also provides competitor and country intelligence. Get a free trial.