MNI China Auto Purchase Sentiment Report: Chinese Car Purchase Sentiment Edges Down In November - Cheaper Variants Of Cars Gain In Popularity

Between October and November, consumers were marginally more enthusiastic about the car purchasing environment, but a noticeable rise in expected running costs weighed more heavily on overall sentiment. Consequently, consumer attitudes towards the car market tempered in November. Despite the fall in sentiment, more Chinese households reported that they planned to buy a car, according to the latest MNI China Auto Purchase Sentiment Report.
 
The Car Purchase Expectations Indicator (a gauge of whether consumers believe it is a good time in general to buy a car) increased marginally 0.4% to 101.8 in November from 101.4 in October. This increase was not sufficient to push the MNI China Car Purchase Sentiment Indicator (made of expected running costs and buying conditions) higher over the month. The indicator edged down to 88.3 in November from 90.0 in October, driven by a noticeable rise in the Price of Gasoline Expectations component, which rose 3.1% to 125.2 in November from 121.4 in October, the highest reading since December 2015.
 
Meanwhile, car ownership levels regained some of the ground lost previously. The ownership rate increased in November with 36.2% of consumers reporting that their family owned a car, up from 34.6% in October. A supporting factor for car ownership in the short-term was a slight uptick in plans for buying a car. The percentage of those planning to buy a car in the next 12 months ticked up marginally to 11.5% in November after easing to 11% in October, the lowest level since July 2014.
 
The planned car budget of Chinese families continued to trend towards the middle ranges in November with the more expensive bands falling out of favour. Meanwhile, Chinese households shifted their budget preferences towards the cheapest options during the month with a notable pickup in the budget tiers below the CNY 80,000 to CNY 90,000 range. The largest percentage of responses again went to the mid range of CNY 100,000 – CNY 140,000 although there was a scale back in this range, while the budget tier above commanded the next highest proportion of responses.

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