The economy is forecasted to slow its growth to levels not seen since the 1990s, so the world’s largest auto market is on a declining trend these days, despite massive investments from virtually every major automaker.
With the economic woes in full swing, the auto market slowed to its smallest growth rate in around 15 years, prompting Ford to respond by not only lowering prices next to General Motors and Germany’s Volkswagen Ag, but also considering a reduction of production output. That would trigger a massive change for the local unit of the second largest US automaker, which just two months ago announced it was opening another massive assembly facility in Hangzhou, as it strategized the need to double production capacity in the country to 1.2 million units per year. “If there is softness in the market, I won’t let stocks build and we’ll cut production,” commented David Schoch, president of Ford Asia Pacific.
Ford, a latecomer on the Chinese market, rushed to profit from the incredible sales gains that transformed China in just 15 years into the world’s largest auto market. In some years, the advanced almost reached 100 percent and even during the latest recession that dragged the US market to its lowest level in years the Chinese market grew at double-digit rates. But the country’s auto market is now approaching maturity and industry experts predict it would only soar this year at around 7 percent. Ford itself sees the overall sales level for the year in between 24 and 25 million – around half a million vehicles less than it originally predicted at the start of the year.