At the heart of this has been the automotive industry, whose turnaround makes for remarkable reading. In October, the Chinese market posted its sixth consecutive monthly year-on-year rise in new car registrations – a stunning result, given that the figures in the world’s largest car market had been stagnating for almost two years prior, dipping for each of the preceding 21 months.
While bumps are still expected in the future as a variety of stimulus packages are withdrawn (ranging from a £1 billion fund to drive EV uptake to the easing of restrictions put in place to slow car-buying in polluted cities), it’s predicted that 2019’s total registrations figure will be comfortably eclipsed by 2022.
“It looks sustainable,” said Russo. “The new car figures are impressive, but this is about a whole-market move to mobility, including commercial vehicles, used vehicles and over forms of micromobility, such as e-bikes and scooters.
“It’s driven by a desire to escape the petri dish of public transport during a pandemic, but this is an upwardly mobile population that will want to keep enjoying the benefits of personal transport.”
So it is that China’s position within the global car industry has strengthened again, with numerous Western companies’ fortunes intrinsically knitted into its fortunes.
A measure of its importance, for instance, can be seen in the Volkswagen Group’s financial records. Its 12 brands posted profits of £3.2bn in the third quarter of 2020, the figures driven most strongly upwards by strong Chinese demand for Audi and Porsche; it lost £1.2bn in the first half of the year.
At times in this tumultuous year, the Chinese market has accounted for upwards of 40% of the German giant’s sales volume and 30% of its profits.
The flipside to that story, and a cautionary tale of over-reliance on what have long been rapidly evolving market tastes, is the ongoing catastrophe of the PSA Group’s sales collapse in China. Back in 2014, it recorded more than 700,000 registrations through its joint-venture partnership, eclipsing sales even in its native France. Heavy investment in manufacturing plants and retail sites followed but sales didn’t, as German and Japanese rivals eroded its advantage and Chinese firms got their acts together to sell cheaper, capable alternatives. This year, PSA is expected to sell fewer than 50,000 cars in China.