Chinese consumers are changing their new car purchasing plans or are postponing their purchases due to rising fuel prices, according to a recent Nielsen China survey. Automobile sales in China in August 2008 shrank 6.3% year on year to 629,000 units, the first fall in about two years.
An online Nielsen study looking at the effect of oil price increases in China’s key cities Shanghai, Beijing and Guangzhou, has found that of the 71% of respondents who do not currently own a car around a third claim to be considering buying one. However, because of the high oil prices, consumers are reconsidering their purchasing decisions.
Twenty-five percent will delay their purchase and a further 22% are now no longer in the market to buy a car. For those who remain interested in a car purchase, 18% are considering a fuel efficient car because of oil price increases. A quarter remains unaffected by the oil price rise.
Among all people surveyed, Shanghai consumers are the least likely to be put off by oil price increases and will go ahead with their car purchase plan soon (33%). Beijingers tend to be more conservative and have chosen to put their car purchases on hold (33%) and Guangzhou consumers are perhaps the most price sensitive among those surveyed, with 31% of consumers deciding that they are no longer in the market.
The other least-affected group is high income earners—52% said their car purchase plan remains unaffected or they will consider a fuel efficient model—compared to 57 percent of those lower income groups who plan to delay or put off their car purchase plan.
Oil price increases have had an impact on some consumer groups, however consumer demand is still quite strong, particularly among the younger, middle class. Obviously oil price hikes have had an impact on Chinese consumer’s car buying decisions, including their choice of the types of car they would buy.—Georgia Zhuang, head of Automotive Research at Nielsen China
Of those intending to purchase a car, more than half indicated that they would purchase a fuel efficient car like a A00 Class (example QQ size-7%), A0 Class (example polo size-16%), A class (example Santana size-26%) and B class (example Passat size-17%).
The A class car was the type of car most considered for purchasing by consumers in Shanghai (34%) and Beijing (28%).