China Automotive Research Institute: China's automotive industry 2019 summary and 2020 outlook report

Macro comprehensive analysis

• 2020 is a critical year for the elimination of backward automakers
• Against the backdrop of capacity reduction, inventory reduction and declining consumption growth, the overall market will continue to fluctuate and bottom out in 2020
• The decline in automobile sales in 2020 narrowed to -1.2%, and the Chinese automobile market will usher in a new round of prosperity in 2024

Passenger car field

• The market showed three major characteristics in 2019: SUVs performed better than other models; the share of high-end brands increased at a faster pace; and Chinese brands saw the largest decline in share
• Three major structural opportunities in 2020: The consumption upgrade trend remains unchanged, and the growth of high-end cars is positive; the second-time car buyer group is further expanded, and the mid-to-high-end
• SUVs are popular; policies encourage shared travel, and pure electric sedans are the mainstream models

Commercial vehicle field

• Strong macroeconomic factors lead to stable demand for heavy trucks; the road-to-rail structure is adjusted, resulting in oversupply of passenger cars
• Sales trend: Truck demand remains stable in 2020, while passenger cars continue to be under pressure
• The final sprint of the “Three-Year Plan” continues to release the effect of overweight control

New energy field

• Three technical routes of new energy vehicles are developing in parallel. Pure electric vehicles are still the mainstream, plug-in hybrid vehicles are expected to mature, and fuel cell vehicles are expected to be the mainstream.
• The car is beginning to show signs of development and is developing in a positive direction
• Foreign-invested automakers increase investment in electrification to stimulate competition in the domestic market
• In 2020, the government will rely on non-fiscal and taxation policies to guide industrial development; industrial boundaries will be weakened, showing a multi-party integration

Intelligent Networking Field

• Intelligent connected vehicles are moving from testing to commercialization. Six cities have opened manned testing and cargo testing has started for the first time.
• L2 products are put into mass production, accelerating their penetration into the mid- and low-end markets, and will be introduced on a larger scale in 2020
• The rapid growth of local supporting enterprises and the development of the industrial chain towards independence and controllability will help reduce costs and increase the competitiveness of local automakers.

Parts field

• The main business income showed a downward trend, corporate profits narrowed, and the growth rate of imports and exports slowed down.
• Enterprises focus on the "New Four Modernizations", accelerate capacity layout, and focus on new energy and intelligent networking at the product level
• The automotive aftermarket has huge potential and the overall positive trend remains unchanged. In 2020, challenges and opportunities coexist, and the overall development is positive. Core technology is the key

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