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 Mini-vans, or multi-purpose vehicles (MPVs), were front and center
at the Guangzhou auto show, where Volkswagen AG presented a
supersized version of its Touran and Guangzhou Automobile Group
subsidiary GAC Motor showcased a prototype mini-van. The show ended
Sunday.
These seven-seaters currently account for just 10 percent of
passenger car sales in China, but sales are growing at a faster pace
than the entire auto market, the world's largest.
Industry experts say the appetite for bigger cars is strong enough
in China, where extended families often live under one roof, to
potentially turn it into the largest MPV market after the United
States, where automakers have sold big cars to families for years.
At the end of October, China further relaxed its one-child policy, a
move which experts said would not necessarily lead to a sudden
increase in the size of the average family.
But Chinese authorities hope it will help boost the population to
1.45 billion by 2030 from 1.37 billion at the end of last year.
"After the roll out of the two-child policy, I believe the market
share of 7-seat SUVs and MPVs will further strengthen," Wu Song, GAC
Motor's general manager, told Reuters.
MPV sales for the first 10 months of the year grew 7.8 percent,
according to the China Association of Automobile Manufacturers,
outperforming the 1.5 percent growth in the overall car market.
FAMILY FRIENDLY
The focus on Chinese families is relatively new for MPV makers which
for years targeted companies seeking large, luxurious models for
executives or small businesses that need a workhorse to haul goods
and staff.
Many households include at least one set of grandparents, as they
play a key role in childcare. These extended families, coupled with
restrictions in most major cities on owning a second car, give MPVs
an advantage over the five-seat sports utility vehicles (SUVs) that
currently account for the bulk of passenger car sales growth.
"The cost of owning two vehicles is high. That is why demand for
seven-seat vehicles has grown greatly," said Gustavo Céspedes,
executive vice president of General Motor's joint venture with SAIC
Motor and Wuling Motor which makes China's best selling MPVs.
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GM and its partners account for more than half of all MPV sales. The
top seller is the Wuling Hongguang, a utilitarian mini van that
starts at 42,800 yuan ($6,700), but the more family friendly Baojun
730, which starts at 69,800 yuan ($10,926), became the second most
popular MPV just one year after it was launched.
Spurred by the rapid success of the Baojun, rival Geely Automobile
Holdings is designing a mini-van for families, a person familiar
with the matter said. A company spokesman said it was too early to
discuss future products.
GAC Motor also sees opportunity in families. Design director Zhang
Fan said GAC started working on a car two years ago to fill the gap
between basic mini-vans and high-end models such as Toyota Motor
Corp's Alphard, which starts at 759,000 yuan. "That gap is actually
quite lucrative," he added.
The rising popularity of the lumbering MPV shows that more Chinese
consumers are becoming savvy and choosing cars that meet their
needs, and not because of the status they confer.
Ma Li, a plastic surgeon in Beijing, bought an MPV because he said
its sliding doors were safer for his 10-year-old son.
"I didn't think at all how my friends would view this car," Ma
added. "The important consideration was the practical use."
(Additional reporting by Beijing newsroom; Editing by Kazunori
Takada and Miral Fahmy)
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