The world's major car makers are moving toward the Chinese market in droves to take advantage of the increasingly larger car market in the world's most populous country. Last year alone, as many as 17 million cars were sold in China, with about 7 million commercial vehicles including buses and trucks sold as well.
This year, the number of cars sold is likely to rise to 18.5 million. The Chinese car market is estimated to reach 23 million in 2018 and 26 million in 2020. By that year, the total number of vehicles including commercial vehicles will be about 35 million.
In response to the steadily rising market, major auto makers like Volkswagen, GM, Hyundai, Kia, Ford, are Renault-Nissan are increasing their capacity jointly with local partners. For example, Volkswagen Group plans to invest up to 18.2 billion euros (US$19.7 billion) by 2018 in new assembly plants and R&D. It will raise the annual output to 5 million. GM, the No. 2 car maker in China, will also try to increase its output to 2.9 million by 2017 by investing up to $12 billion.
Not to be outdone, Hyundai Motor and Kia Motors are trying hard to expand its capacity in China. Last month, Hyundai held a groundbreaking ceremony for China's fourth assembly plant in Cangzhou, Hebei Province. By 2018 when the fifth plant in Chongqing, as well as the fourth, is up and running, Hyundai and Kia will have a total of 2.9-million-car-a-year capacity. A Hyundai Motor official said, "If the car demand in China is sustained, it is likely to benefit parts suppliers as well."
