Consumer confidence towards the car market ended the quarter on a slightly weaker note. While Chinese consumers remained enthusiastic about the car purchasing environment, a rise in expected running costs weighed on overall sentiment towards the car market. That said, more Chinese households reported that they currently owned a vehicle and planned to buy a car over the next 12 months, per the latest MNI China Auto Purchase Sentiment Report.
The MNI China Car Purchase Indicator, a composite indicator designed to gauge overall conditions in the car market, fell 2.2% to 89.0 in September from 91.0 in August. The fall in the indicator was the result of higher expectations for fuel prices. The Price of Gasoline Expectations component rose 3.4% to 124.8, indicating that most consumers expect fuel costs to increase in the coming year.
The Car Purchase Expectations component (a gauge of whether consumers believe it is a good time or a bad time to buy a car), was broadly unchanged at 102.9 in September compared with 102.7 in August, as consumers revised up their outlook for personal finances and the wider business environment, as seen in this survey’s parent publication - the Westpac MNI Consumer Sentiment Survey.
The relative stability in car purchase expectations, still above the neutral 100 level that separates optimists from pessimists, may suggest car sales will help underpin overall market sentiment in the near term.
Both car ownership and plans to buy a car increased slightly in September. 12.1% of respondents said they planned to buy a car in the next 12 months, up slightly from 11.9% in the month before. There was also a slight rise in the level of car ownership, with 39.2% of respondents saying they currently owned a car, up from 38.4% previously.
Meanwhile, results from the special quarterly question showed that Volkswagen remained the preferred brand of choice in September, commanding 25.3% of responses, slightly down from 26.6% in June.
Honda surged into second place with a 12.2% share after accounting for just 7.4% in June. BYD remained the most popular domestic brand, extending its share in September. The survey also revealed that car safety remained a top concern among Chinese consumers while price took a backseat. 58.3% said that safety was the main factor they considered when buying a car and 12.8% nominated price.