Car buyers expect more for less
Chinese consumers are not willing to pay as much as before when buying a vehicle, according to a study published by consulting firm J.D. Power on Thursday.
The study shows that the average price of cars considered by intended buyers has dropped by 12 percent to 215,000 yuan (US$31,000) in 2019 from 244,000 yuan last year. Moreover, willingness to replace a current car with a new one has decreased to 20 percent from 37 percent in 2016.
“Tightened budgets and the unwillingness to replace current vehicles make it hard to be optimistic about the new car market in 2019,” said Edward Wang, research director at J.D. Power China.
“Consumers in China are mostly motivated by demands such as making a better life or enjoying driving, which result in owning a new car being an option rather than a must," Wang said.
In addition, battery technology and vehicle reliability have become big concerns in the new-energy vehicle market. Worries about the range of NEVs has significantly reduced to 33 percent from 42 percent in 2018, while concerns about battery technology and vehicle reliability have increased by 9 percent and 8 percent.
The study also found that when considering a new car, the importance of technology has risen to 7 percent from 3 percent in 2018. Buyers expect interior multi-media features, with built-in navigation systems, Bluetooth and Internet connection.
Wang said that customer expectations of in-vehicle technology significantly increased when purchase budget exceeds 100,000 yuan, so it is important for manufacturers to provide flexible options.
Consumers are wary of buying cars online. Although 70 percent of respondents say they “definitely would” or “probably would” buy a new car on the car manufacturer's official website or a third-party trading platform or mobile app, only 7 percent say they are willing to pay the full price online.
The study, conducted online in March and April, was based on 11,977 responses.