China’s heavy and medium truck and tractor markets remained soft in the third quarter, with total sales declining more than 26% y/y and 30% q/q, according to the China Commercial Vehicle Outlook jointly published quarterly by ACT and China’s State Information Center (SIC).
The pace of growth of China’s economy slowed to 6.9% on a year-over-year basis in Q3’15, down slightly from the 7% pace recorded in the previous two quarters. For perspective, full-year real GDP growth in 2014 was 7.4%, while 2013’s economic growth was 7.7%. China’s real GDP has been trending downward from double-digit levels and is now settling into a new normal in the single-digit range.
According to Jim Meil, ACT’s Principal Industry Analyst, “Very recent headline-making developments and achievements demonstrate that China continues to evolve, faces necessary changes, and earns recognition for its prominence in the global economy, as the country’s leaders continue to grapple with the challenges of recalibrating economic growth targets and implementing appropriate policies.”
“Heavy and medium truck and tractor markets may show temporary signs of improvement, but will remain subdued for the foreseeable future, until changes in both the country’s economy and the evolution of its transportation industry have stabilized,” said Robert Perkins, Senior Global Business Consultant at ACT. Perkins added, “The country’s transportation industry is undergoing several changes that will impact vehicle demand, including rapidly improving vehicle quality, significant logistics efficiency, and higher capacity vehicles.”