Survey finds Chinese drivers most open to flexible automobile solutions

10 January 2020 Consultancy.asia

New consumer research from OC&C Strategy Consultants has found that, yes, young people are still interested in owning cars, including two thirds of those surveyed in China.

A global automotive survey conducted by OC&C Strategy Consultants among more than 10,000 consumers in five markets worldwide has found that contrary to generalisations the younger generation, or, ‘generation rent’, do in fact hold an interest in car ownership – they just can’t afford them. Indeed, 90 percent of 18-29 year-olds surveyed in China expect to buy one at some point, with almost four out of five of all local consumers seeing a personal vehicle as ‘essential’.

Across all markets of the survey – which in addition to China included respondents in the US, UK, Germany and France – no less than 60 percent saw the car as essential for getting around, with two thirds in China agreeing that car ownership was an important part of growing up, a figure which eclipsed even the US, the ‘spiritual home’ of the automobile and open road. Over 45 percent of Chinese consumers also still considered the car an ‘important status symbol’.

Global views toward car ownership

Nevertheless, the survey found that affordability and associated costs are the greatest barrier to car ownership for people in the 18-29 y/o bracket across all countries, which is contributing to a sea change in latent consumer behaviour towards “simple, bundled packages which take away the hassles and risks of ownership” – a development which is already disrupting the industry as the dealership, rental, leasing, financing and servicing segments collide.

Here, 37 percent of Chinese consumers agreed with the statement “I don’t care if I lease or own my vehicle”, with the same number again expressing neither agreement or disagreement – the 74 percent combined total well ahead of the next closest surveyed nation, the US, which combined for 52 percent (with 24% in agreement). The combined figure in the UK and Germany meanwhile totalled just 43 percent – the latter registering only 18 percent outright agreement.

Global views toward flexible automobile solutions

In addition, more than one half of Chinese drivers – described as demonstrating a significant openness to flexible solutions – report considering a shared mobility model (such as car-sharing clubs and hourly usage charges) instead of their own car, compared to under 15 percent in both the US and Europe. Chinese consumers also record the greatest appetite for bundling, where insurance, road support, and serving and repair are packaged in a monthly payment.

Indeed, nearly two thirds of Chinese consumers expressed an interest in a fully inclusive monthly subscription which includes the ability to change cars – a general sentiment which has driven 145 percent growth in car-sharing and P2P apps in China in recent years. “Without historical attachment to ownership and under the influence of high costs/constraints on urban vehicles, China is leapfrogging towards innovative vehicle concepts across the board,” states OC&C.

In assessing the overall findings and persistent regard for car ownership, the authors conclude with a note for industry players. “These trends should be reassuring for most of the providers in the automotive value chain with substantial continuity on the private vehicle. However, the world will increasingly look bundled around a single monthly payment. This will create risks and opportunities; now is the time to lay bets to win and future-proof your proposition.”


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