Chinese demand for commercial vehicles remains subdued

The market for trucks and trailers remained slow in the first quarter of 2015, according to figures compiled by ACT Research of Columbus, Indiana.

Total sales (domestic and export) were just over 135,000 heavy trucks and tractors in for the first three months of this year, down approximately 16% from the 162,000 units that were estimated to have been sold in the previous quarter.  Sales were off more than 33% from the first three months of 2014.

These figures were reported in the most recent China Commercial Vehicle Outlook, jointly published quarterly by ACT and China’s State Information Center (SIC). The Outlook includes an overview of the China economy and a review and forecast of China’s heavy and medium-duty truck and bus markets, as well as analysis of OEM market shares within China.

The pace of growth of China’s economy slowed to 7.0% on a year-over year basis in Q1’15, following an unchanged 7.3% y/y in Q4’14. For perspective, full-year real GDP growth in 2014 was 7.4%, while 2013’s economic growth was 7.7%. In 2010, the country’s economy was growing at a 10.4% y/y pace, but 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.

“Heavy and medium truck and tractor markets will remain subdued before shifting to a slow growth path later in the year 2015,” said Robert Perkins, senior global business consultant at ACT. “Consumption and exports will have a positive impact, but will not likely compensate for the impact resulting from the downturn in real estate and manufacturing investment. However, newly approved infrastructure projects will support truck demand in the second half of 2015; national government funding commitment for these projects will be key due to high local government debt and regulatory revisions requiring a positive payback for projects.”

SIC is affiliated with the National Development and Reform Commission of China and is engaged in research on the macro-economy, key industries and information technology.

For more information on ACT and the China Commercial Vehicle Outlook report, visit www.actresearch.net.

TAGS: Market Stats
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