Decreasing purchase tax benefits have limited effects on Chinese car market

Data from CAAM shows that self-independent brands sell 786,000 units in February with a year-to-year growth of 22.9%, 4.6 percentage points higher than the passenger vehicle market growth. Statistical data also shows that the purchase tax policy has limited effects on self-independent brands’ sales volume. Most self-independent brands including Changan, GWM and Geely show a relatively high growth in sales.

Experts analyze that self-independent brands have shown improving brand influence and product quality, which is the main reason why self-independent brands also show high growth under the narrowing purchase tax benefits.

According to data, the new model Baojun 310 has a total sales volume of 16,100 units in February, ranking top 10 brands among cars. Geely Boyue also ranks top 10 SUV models with sales of 20,100 units.

It’s said that the new-generation products show great effects in promoting sales volume of self-independent brands, such as the Geely 3.0 products and RX5 of SAIC passenger vehicles. These products have reached the level of joint-venture brands in performances, appearances and comfort. From this point of view, self-independent brands have the ability to compete with joint-venture brands even without benefits.

Analyses believe that the promoting competitive power of self-independent brands has blurred the distinction between joint-venture brands and self-independent brands. Consumers pay more attention on the products’ reputation and cost performances, rather than the brand itself.

Self-independent brands account for 43.2% of passenger vehicle market share in 2016, still lower than joint-venture brands. It’s estimated that the share will increase one or two percentage points than last year. In the future three to five years, the increasing self-independent brands’ sales volume is expected to be levelling with joint-venture brands.