BEIJING--(BUSINESS WIRE)--Technavio market research analysts forecast the automotive seat market in China to grow at a CAGR of more than 5% during the forecast period, according to their latest report.
The market study covers the present scenario and growth prospects of the automotive seat market in China for 2017-2021. The report also lists passenger cars and commercial vehicles as the two major application segments, of which the passenger cars segment accounted for more than 88% of the market in 2016.
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Technavio analysts highlight the following three market drivers that are contributing to the growth of the automotive seat market in China:
- Growing dependency on public transportation
- Increasing demand for SUVs and crossovers in China
- Government initiatives to reduce taxes on small passenger cars
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Growing dependency on public transportation
The main reasons for the increase in the demand for public transportation are aging population, rising fuel prices, increasing urbanization, changing consumer preferences along with increasing health and environmental concerns. The key benefits of public transport include reduction in traffic congestion, reduced travelling distance through metros, and improved comfort and convenience for users. Public transportation helps in reducing additional costs associated with traffic congestion, accidents, and CO2 emissions.
According to Ganesh Subramaniam, a lead analyst at Technavio for automotive components research, “Beijing is planning to invest USD 113 million for developing transport infrastructure during 2016-2020, which will increase the demand for public transportation. The increase in the number of buses on the roads will drive the automotive seat market in China as the buses are equipped with more number of seats than passenger vehicles.”
Increasing demand for SUVs and crossovers in China
The market share of SUVs in the automotive market in China has and is expected to grow significantly during the forecast period. This is mainly due to the emergence of small SUVs that combine the functionality of a utility vehicle while offering the performance and other advantages of SUVs. The price mix and utility has caught the attention of consumers in the country. In addition, the increasing preference for larger vehicles in China is due to the perception of having a higher social status by owning a larger car. All these factors are driving the market for SUVs in the country. The growing demand for SUVs and crossovers is aiding the growth of automotive seat market as these vehicles typically require more seating.
Government initiatives to reduce taxes on small passenger cars
In 2016, the automotive market in China 2016 was largely dominated by small passenger cars. The increase in the sales of small passenger cars was mainly due to reduction in taxes by the Chinese government and other subsidies offered by the dealers. There is a growing demand for better seats in compact and subcompact car models. Individuals prefer to buy small vehicles that have better seating features when compared with the previous models. Therefore, the increase in the market share of small passenger cars has increased the market penetration of seat features in these small cars.
“OEMs are realizing the importance of seating and interior comfort and are focused towards integrating these in their vehicles. There is an increasing emphasis on the design of interior seats to ensure comfort, which is emerging as a significant factor in determining the consumers’ choice of vehicle. This development augurs well for the growth of the market,” says Ganesh.
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