MNI China Auto Purchase Sentiment Survey: Car Buying Expectations Highest Since August 2014 - Volkswagen Remains Brand Of Choice - SUV Popularity Dips

While not all the data from the latest survey was unanimously positive, and car buyers remain cautious, a significant rise in car purchase expectations suggests car sales will find some support over the coming months. That increase in optimism pushed the Car Purchase Indicator back near the level recorded at the end of the first quarter, with sentiment now sitting just below its long term average.
 
The June edition of the survey also revealed that Volkswagen extended its lead as the brand of choice among Chinese consumers while the best performing domestic brand, Buick, also extended its share. Consistent with the continued softening in economic conditions, high-end brands like BMW and Mercedes lost ground, as did SUVs as a preferred car type.
 
The Car Purchase Sentiment Indicator rose to 87.2 in June from 86.7 in May, the fifth increase so far in 2015. The marginal gain in the indicator, which is made up of two components, was led by an increase in the proportion of respondents who thought that the car purchase environment improved, as measured by the Car Purchase Expectations Indicator. This component edged up 3.3% to 100.1 in June, the highest since August 2014 as consumers revised up their outlook for personal finances and the wider business environment, as seen in the Westpac MNI Consumer Sentiment Survey. The other component that makes up the main Car Purchase Sentiment Indicator, the Price of Gasoline component, was up 1.8% to 125.7 in June.
 
Car ownership levels dropped slightly over the month to 39% in June from 41.5% in May, but remained elevated by historical standards. Plans to buy a car were similarly under pressure, falling to 16.2% in June from 18.6% in May, although the upward trend that has emerged over the last few years remains intact.
 
Chinese families shifted their budget preferences towards the middle ranges in June, and continued to opt away from the cheapest options. The largest percentage of responses was again in the mid range of CNY 100,000 – CNY 140,000 while the second most expensive tier, CNY 150,000 – CNY 190,000 commanded the next highest proportion of responses.