Small SUV is popular in China:anaylsis

There are many analysts in the Chinese auto market who doubt the long-staying power of small-size SUVs, pointing to concerns that they lack both the stable handling and large interior space of their bigger brethren. However despite those assertions, sales of small SUVs remain very impressive. According to statistics compiled by Gasgoo.com (Chinese), small SUV sales in July totaled 148,171 units, accounting for 24.98% of all SUV models sold in the country over the course of the month. Three of the top ten best selling SUV models for the month were small SUV models.

Small SUVs were born as a result of fierce competition on the compact SUV segment. Joint ventures tried their hand at slightly adjusting the sizes of their models while also decreasing prices, leading to the creation of this new segment. Small SUVs resonated with a market that is becoming increasingly more diverse, appealing specifically to younger buyers.

The Chinese auto market is greeting the arrival of a new generation of younger buyers. These buyers tend to prefer trendy, sportier designs. Unlike the generation before them, which preferred utilitarian vehicles like hatchbacks, this new generation has turned its focus towards SUVs.

Small SUVs are a segment tailored specifically towards the unique demands of the Chinese market, which don’t pose the same restrictions on long wheelbases as some foreign markets do. Manufacturers have also made a special effort to create fashionable, dynamic exterior designs that are specifically appealing to younger buyers.

Another important trait of younger buyers is the fact that they have been exposed to automobiles from a younger age than their parents, so they tend to already have a better understanding of what they want and are less likely to be convinced to purchase overpriced vehicles. Therefore, for these intelligible buyers who are just starting to raise families of their own and are on a budget, small SUVs appear to be an excellent choice for their competitive price point, perceived safety, high driver vantage point and sporty design.

The small SUV is the perfect solution for buyers who can’t afford compact SUVs from joint ventures but still don’t feel secure buying domestic brand SUVs.

Small SUVs also benefit from the fact that many third- and fourth-tier cities in the country still have a large amount of roads that are undergoing construction and are not fully paved yet. One only needs to visit the inner regions of Gansu or Inner Mongolia to witness this phenomenon first-hand. Small SUVs are seen as the perfectly safe yet affordable answer for new households needing a vehicle to transport their families.

Small SUVs are also seen as the perfect transition vehicle. Many younger buyers purchase these vehicles as a first car to be used for a few years before moving on to buying more expensive vehicles. As a result, small SUVs are performing especially strongly on the second-hand market, where they have been retaining their value quite well. 

Having been made specifically for the Chinese market, small SUVs take advantage of their smaller size, which is ideal for the congested roads of China, while offering the driver a high vantage point from which to navigate traffic and seek out hard-to-find parking spaces. Also, compared with sedans, small SUVs still possess slightly roomier interiors, which make them better suited for long drive times that are the result of high congestion rates in Chinese cities.

Another strength is the perceived enhanced safety that small SUVs offer in the case of a collision. This is a common belief that many Chinese consumers have despite the increased rollover risk of SUVs compared to sedans. Also, in order to sell these vehicles at a competitive price, many manufacturers have excluded electronic safety systems such as ESP and VSC.

As a transitional vehicle small SUVs seem to have a promising future. However, they are still a far ways off from replacing other model types to become the country’s best-selling kind of SUV. That said manufacturers have been doing an especially good job of catering to the unique demands of Chinese consumers. If they are able to continue to keep track of what Chinese buyers desire and deliver new revisions that meet their requirements, small SUVs may very well be here to stay for the long term. Chinese consumers, for their part, also seemed to be pleased with the vehicle’s classification as an entry-level automobile.