China To Dominate 30 Percent Of Global Car Sales By 2020

More car brands, including BMW as seen in the picture, are moving their production into China. (BMW)

More car brands, including BMW as seen in the picture, are moving their production into China. (BMW)

China is set to take the lead in BRICS nations’ rise in the global car market. The emerging national economies, comprising Brazil, Russia, India, China, and South Africa, are predicted to be the largest market for light vehicles in the next five to 10 years, according to a report from industry researcher IHS Automotive Consulting.

According to Chinese news site China Daily, the report projects that China alone will account for 30 percent of all global car sales in 2020—a 23 percent surge from 2012. Brazil and India are expected to take up five or six percent of global car sales comparatively.

The BRICS countries’ rise will take place as the mature United States and Europe markets shrink, the report says. The U.S. share is expected to shrink from 26 percent in 2005 to 15 percent of global market share in 2020.

According to data from the International Organization of Motor Vehicles Manufacturers (OICA), China produced 25 percent of all vehicles in the world in 2013. IHS’ report says that China and the rest of the BRICS nations will produce half of the world’s total car production by 2020, as automakers continue to build plants in these countries.

“Most luxury cars sold in China—be they BMW, Benz or Audi, used to be imported. As the Chinese market became more important, they now have local production,” wrote the report’s author Lin Huaibin, citing China’s luxury car market as the foremost indicator of that production change. He said that half of luxury cars sold in China are now made in the country—a percentage that will grow to about 70 percent in 2025.

Research and development (R&D) centers are also relocating to the BRICS countries, such as the one Infiniti set up in Shanghai last year. BMW also set up an R&D center in Shenyang in 2010 to help meet Chinese demand for its cars. “More importantly, the centers not only design and develop models for the Chinese market but also for customers in other countries,” said Lin.



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