On October 20, 2024, the Wangfujing Forum kicked off in Beijing, and one of its subforums, titled “Automotive Consumption Development,” saw the release of the “2024 White Paper on Promoting Automotive Consumption and User Insights” by Dongchedi in collaboration with the China Association of Automobile Manufacturers. The white paper highlights the significant impact of automotive consumption policies in 2024, noting that vehicle replacement and upgrades have emerged as one of the primary demands in the automotive market.
The white paper focuses on five key areas: policy research, consumer insights, corporate dynamics, expert opinions, and industry initiatives. It aims to assess the effectiveness of automotive consumption policies and provide recommendations for the development of the Chinese automotive industry.
Through a consumer survey conducted for the white paper, it was found that over half of the respondents believe that consumption vouchers significantly enhance their willingness to purchase a vehicle. Nearly one-third cited these vouchers as the direct catalyst for their buying decisions, while more than 75% indicated that purchasing subsidies play a strong role in boosting automotive consumption. Interestingly, only 20% of respondents reported having benefitted from purchase subsidies, indicating substantial room for growth in this area.
The subsidies have also spurred the replacement of older vehicles and increased the share of new energy vehicles (NEVs) on the market. The survey revealed that approximately 40% of those replacing older cars were trading in vehicles over ten years old, and over 60% of new purchases were for NEVs. When it comes to vehicle pricing, more than half of consumers are opting for cars in the 100,000 to 200,000 yuan range, demonstrating a shift from a “dumbbell” consumption structure to a “spindle” one.
Additionally, the white paper examines the experiences of consumers receiving subsidies. More than 80% of those who have accessed vehicle purchase subsidies believe that reducing the time it takes for subsidies to be deposited can enhance the effectiveness of these policies and accelerate the flow of subsidy funds, thereby increasing their appeal.
In terms of information sources about these policies, platforms such as Dongchedi and Douyin (TikTok) serve as major channels for consumers. On one hand, the diverse, short video formats significantly broaden the reach of policy communication, making more consumers aware of available benefits. On the other hand, automotive media platforms can precisely and efficiently target potential car buyers, improving the conversion rates of these policies.
Beyond consumer surveys, the white paper launched three initiatives focusing on “technological innovation, service innovation, and product innovation.” It calls on all participants in the automotive supply chain to inject new momentum into industry development through technological advancements and to foster collaboration to avoid unhealthy competition, ultimately providing consumers with high-quality and diverse purchasing services and automotive products.
Ding Yan, director of the automotive market division at the National Information Center, pointed out that under the influence of the old-for-new vehicle subsidy policy, new energy cars priced below 150,000 yuan have become a significant growth segment. However, he noted that price alone is not the primary concern for consumers; quality is becoming the dominant trend. Companies need to find a balance between sales volume and profit while recognizing that younger generations are increasingly accustomed to purchasing cars through both online and offline channels, with NEV users more inclined to share their experiences online.
Chen Shihua, deputy secretary-general of the China Association of Automobile Manufacturers, stated that the growth rate of vehicle production and sales in China is gradually slowing, and the fuel vehicle market continues to decline. However, new energy vehicles are experiencing rapid growth, with their market share reaching 54.6% in September. Furthermore, domestic brands are gaining traction, with a market share of 63.8% for passenger cars from January to September 2024, and NEVs capturing over 80% of the market.
Chen emphasized that as a ballast in maintaining steady growth in the industrial economy, automotive subsidy policies must continue to be promoted to alleviate inventory pressures and enhance profitability, thereby addressing the challenge of increasing output without corresponding profitability in the industry.
Li Xin, strategic leader at Dongchedi, noted that data shows consumers are extending their decision-making cycles, and government subsidies hold significant potential in encouraging spending among hesitant buyers. As of October 9, the platform had assisted 130,000 consumers with subsidy applications, driving automotive consumption above 23.2 billion yuan.
Experts including Wang Qing, deputy director of the Market Economy Research Institute at the Development Research Center of the State Council, and Cui Dongshu, secretary-general of the Passenger Car Market Joint Conference, anticipate that new vehicle sales in China will maintain an average annual growth rate of around 2% over the next decade. As the automotive consumption market enters a period of slow growth, businesses should adopt digital marketing strategies to enhance operational efficiency and focus on long-term interests, pushing the automotive market toward high-quality development in line with the three key initiatives.