In 2016, 2.4 crore new passenger cars were registered/sold in China – 35% of all cars registered/sold that year globally – making it the world’s largest car market.
The closest was U.S. with 68 lakh – 10% of overall – new car registrations/sales in the same year.
India was placed in the fifth position with 29.5 lakh new cars registered/sold in 2016, 4.27% of overall.
The following table shows the absolute number of passenger car sales/registrations among world’s top ten car buying nations in 2005, 2010, 2015 and 2016.
The following table shows the % of sales in a country compared to overall global sales in a year
As can be seen from the chart, new car sales/registration in high income countries – such as U.S., Japan, Germany have either come down or been stagnant over the last decade, while China has seen a rapid increase and India also witnessed a significant growth.
China seeks alternative
China is well aware of the implications of this sudden glut of cars entering its roads.
It has set strict targets for car makers to shift to so-called new-energy vehicles (NEVs), triggering a rush of companies looking to tap into potential demand for less-polluting cars.
Sales of new-energy vehicles in the China market in January-September totalled 3,98,000, up 37.7% from 2016, industry data showed. The country is on track to meet a sales target of 7,00,000 NEVs this year.
Also the year-on-year growth of new car registrations in China has also come down after a tax break for smaller cars was cut back.
Many Chinese cities, including Beijing and Shanghai, have already imposed severe restrictions on sale of new cars to contain air pollution and to restrict traffic congestion.
Others are taking precautions
In July, French Ecology Minister Nicolas Hulot announced that France would end sales of petrol and diesel vehicles by 2040 as part of the country’s plan to meet its targets under the Paris climate accord.
The same month, the British government followed suit with a similar plan eyeing 2040 as a deadline to stop sales of new fossil fuel cars.
Singapore, one of the most expensive places in the world to buy a vehicle, will freeze the number of private cars on its roads for at least two years, a rare move in Asia where many cities have seen a spurt in car-use and accompanying traffic issues.
Dip in sales
Apart from these high car density countries, significant trends were seen among others.
For example, in Venezuela, only 1500 new cars were registered in 2016, a startling drop from 2.6 lakh cars registered in 2007. This was the largest such drop among all nations.
Venezuela is going through economic recession, soaring hyperinflation, and shortages of food and medicine, despite being an OPEC country with among the largest oil reserves in the world.
Venezuela’s car assembly output slumped to 2,849 units in 2016 from a record 1,72,418 units in 2007, according to Reuters. To stay afloat in such conditions, Ford and other multinational car manufacturers have shortened shifts, reduced payrolls and focused on cheaper products.
A similar trend was seen in Greece. From 2.7 lakh new registrations in 2008, it came down to 78,873 in 2016.