Business Monitor International


Hong Kong Autos Report

Published 03 October 2014

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Hong Kong Autos Report

According to the Hong Kong Department of Transport (HKDT), vehicle sales for 7M14 came in at 26,449 units, an increase of 8.1% y-o-y. This figure consists of new private car registrations, new goods vehicle registrations and new private light bus registrations.

Previously, our view has been that subsidies provided by the government to encourage commercial vehicle (CV) owners to replace their pre-Euro IV vehicles are unlikely to have a significant impact on the CV segment, due to affordability issues. The Hong Kong government aims to replace roughly 80,000 pre-Euro IV CVs (including franchised buses) by 2019, which will entail average CV sales of over 14,000 units annually from now until 2019.

However, given the more heavy handed approach that the government is now taking via the 'Ex-Gratia Payment' scheme, we foresee that CV sales will increase as vehicle owners look to replace their pre-Euro IV. Since the scheme was implemented in March, CV sales have grown 31.6% y-o-y between March and July. With the new scheme expected to gain traction, we have raised our CV sales growth forecast from 14.9% to 18%.

On the other hand, passenger vehicles sales inched up 0.3% y-o-y in August, while on a year-to-date basis, passenger vehicles sales are up 4.6% for 7M14. As we expect sales to remain muted in the remaining months, we maintain our 2014 passenger vehicle sales growth forecast of 3.5%, with sales of 39,453 units.

As a result of our change in our CV sales growth forecast, our vehicle sales forecast is now 7.0% for 2014, up from 5.1% previously. Nonetheless, we remain less optimistic on the outlook of the sector for 2H14, as or Country Risk team has in August downgraded Hong Kong's GDP forecast from 3.3% to 2.5% on the back of a weakening property market and a slowing Chinese economy - which Taiwan is increasingly dependent upon ( see 'Dual Headwinds Elicit GDP Downgrade', August 22). 

Table of Contents

BMI Industry View
7
SWOT
8
Political
10
Economic
11
Business Environment
12
Industry Forecast
13
Table: Autos Total Market - Historical Data And Forecasts (Hong Kong 2012-2018)
13
Table: Passenger Car Market - Historical Data And Forecasts (Hong Kong 2012-2018)
13
Table: Commercial Vehicle Market - Historical Data And Forecasts (Hong Kong 2012-2018)
13
Table: Motorcycle Market - Historical Data And Forecasts (Hong Kong 2012-2018)
14
Sales
14
Passenger Vehicles
19
Table: Passenger Car Market - Historical Data And Forecasts (Hong Kong 2012-2018)
19
Macroeconomic Forecasts
22
Economic Analysis
22
External Trade Not What It Seems
22
Property Correction Informs Below Consensus Forecast
24
Expenditure Breakdown
24
Table: Hong Kong - Economic Activity
25
Industry Risk Reward Ratings
26
Table: BMI Industry Risk/Reward Ratings - Asia-Pacific Autos
29
Company Profile
30
Company Monitor
30
Crown Motors
34
Mercedes-Benz Hong Kong
36
Sime Darby China
37
Regional Overview
39
Asia Regional Overview
39
Table: Vehicle Sales March 2014 (Cbus)
39
Global Industry Overview
44
Table: Passenger Car Sales March 2014
44
European Growth Gathers Momentum
44
Japan Prepares For Tax Fallout
46
China Wobble Adds To BRIC Weakness
47
Demographic Forecast
50
Table: Hong Kong's Population By Age Group, 1990-2020 ('000)
51
Table: Hong Kong's Population By Age Group, 1990-2020 (% of total)
52
Table: Hong Kong's Key Population Ratios, 1990-2020
53
Table: Hong Kong's Rural And Urban Population, 1990-2020
53
Methodology
54
Industry Forecasts
54
Sector-Specific Methodology
55
Sources
55
Risk/Reward Ratings Methodology
56
Table: Automotive Risk/Reward Ratings Indicators And Weighting Of Indicators
57

The Hong Kong Autos Report features the latest data and forecasts covering production, sales, imports and exports.

Business Monitor International (BMI)'s Hong Kong Autos Report provides industry professionals and strategists, corporate analysts, auto associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on the automotives market in Hong Kong.

Key Benefits

  • Benchmark BMI's independent automotives industry forecasts on Hong Kong to test other views - a key input for successful budgetary and planning in the Hong Kong automotives market.
  • Target business opportunities and risks in the Hong Kong automotives sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Hong Kong.
  • Assess the activities and market position of your competitors, partners and clients via our Competitive Landscape Analysis.

Coverage

BMI Industry View

Summary of BMI's key industry forecasts and views, covering production, sales and the introduction of new technology or products.

Global, Regional and Country Industry Overviews

In-depth analysis of the major global and regional developments in the market, which can be linked with the country industry overview, providing cross-country investment, product and financing trends that will affect each market, supported by BMI’s global and regional industry forecasts.

Business Environment Rankings

BMI's proprietary Autos Business Environment Rankings are a unique country-comparative Risk-Reward Rankings index that separately analyses the risks and rewards of operating in each market. It is aimed at investors (including manufacturers, suppliers and dealers) who seek to either identify and compare market opportunities, or evaluate country-specific operational challenges.

The rankings methodology makes sophisticated use of over 40 industries, economic and demographic data points.

BMI Industry Forecasts

Historic data series and forecasts to end-2018 for all key industry indicators (see list below), supported by explicit assumptions, plus analysis of key downside risks to the main forecast, including:

Total production value (US$bn); total production of units; production by vehicle-type (including cars, commercial vehicles, trucks and buses); total sales value (US$bn); sales by vehicle-type, including passenger cars and commercial vehicles (vans and microbuses, pickups, trucks and buses, 4 wheel drive); total exports by value (US$bn) and by units; total imports by value (US$bn) and by units; contribution to GDP; employment in industry.

BMI Economic Forecasts

BMI forecasts to end-2018 for all headline macroeconomic indicators, including real GDP growth, inflation, fiscal balance, trade balance, current account and external debt.

Company Profiles

Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI's industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.

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Testimonials

'An essential, multi-faceted research tool. BMI’s thorough understanding of the major market players enables an informed – and informative – review of the sector’s actual performance, together with useful insights into current industry issues, which are topped-off with detailed and invaluable forecasts of industry and macroeconomic trends.’

Senior Research Analyst, ABC International Bank plc