Severe Setback Expected for China’s CV Markets in Q1/20

According to the recent release of ACT Research’s China Commercial Vehicle OUTLOOK, China’s heavy and medium truck markets, including tractors, are expected to suffer a severe setback in Q1/20, before a small recovery in Q2.

The report also explained that policies like “reducing human gathering and mobility” in response to the virus outbreak were a heavy blow to freight demand, which harmed medium and heavy-duty truck demand. These same forces have dramatically reduced the medium and large bus forecast.

China’s economy is likely to give less support to the heavy and medium truck markets, particularly with GDP growth muted as a result of COVID-19. This is in addition to the ongoing structural changes, such as stricter weight-limit enforcement, modal shifts, and the removal of NSIII vehicles, within China’s CV markets.

Regarding China’s freight rates, the report noted that rates remain sluggish, with dealers noting that capacity in the market is approaching saturation. As transportation is ultimately a commodity, overcapacity will negatively impact freight rates.

The China CV OUTLOOK, jointly published quarterly by ACT and China’s State Information Center (SIC), includes a review and forecast of China’s heavy tractor and heavy and medium-duty truck and bus markets, as well as analysis of OEM market shares within China and an overview of the Chinese macroeconomy. This quarterly report also includes access to monthly wholesale data, alternative fuels by CV application, market share percentage, industrial policy impacts, and competitive landscape.

SIC is affiliated with the National Development and Reform Commission of China and is engaged in research on the macro-economy, key industries and information technology.

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