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Carmakers Shiver As Chinese Markets Gets Cold
The Chinese car market was driven by huge subsidies and sops from the Chinese government. These lead to a sudden spurt in sales which all global carmakers made use of. Major carmakers such as General Motors, Volkswagen, Mercedes-Benz and Audi now garner much of their sales from China.
But the same thing cannot be said for the future. If the Chinese growth story hits the brakes, then, all these carmakers will have to re look at their global strategies as they were heavily reliant on Chinese sales. It can be said that Volkswagen has been aiming to become the top selling carmaker in the world by selling more cars in growing markets such as China.
But with a slowing economy and increasing fuel prices taking atoll on sales it is highly unlikely that the growth in car sales will be as high as last year. In fact, some say the Indian car market which has seen a slump too will grow faster this year.
Car sales have been below last year's levels during both January and February. This has struck alarm bells among carmakers particularly Mercedes-Benz who is offering huge discounts for the first time. BMW and Audi have also followed their German counterpart and have offered discounts. China is the biggest market for some premium brands such as Lamborghini.
International carmakers are heavily dependent on a growing Chinese car market as their captive markets in Europe and America are not growing at expected levels. With China also slowing down, more carmakers will have to look at markets such as India.
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