China Motorcycle Industry | Review of 2013, Looking Ahead to 2014
Since the onset of the economic “black hole” in 2008, Chinese motorcycle manufacture and sales had been in steady decline. Before 2008 the annual sales of Chinese bikes looked to climb above the 24 million mark but dropped beneath the 23 million mark in 2009 and suffered a slow decline from then onwards.
After a slight upturn in the sales figures of Chinese motorcycles at the end of 2012, 2013 was earmarked as the year that would dictate the future trends of the industry. As with other years the best indicator of the shape of things to come is the spring season Canton fair.
Happily for the industry April’s Canton Fair abounded with motorcycle and parts importers from all over the world. Familiar faces (some of whom had not been seen since 2008) mixed with new ones as a breath of optimism exhaled from the industry’s lungs. That phenomenon was seen again at the Autumn Canton fair and also at CIMAmotor which saw visitors in record numbers.
China’s premier motorcycle exhibition CIMAmotor moved into bigger and more salubrious surroundings at the new Chongqing Exhibition centre which is one of the biggest expo centers in the world. Brazilian motorcycle importer Alberto Futre commented “I have been coming to this expo every year since 2007 and must comment that now CIMAmotor is on the verge of becoming one of the major motorcycle expos in the world; it really is a must see show now and has plenty of room to expand and evolve.”
CIMAmotor was the scene of the two major joint venture announcements of 2013, from Loncin and BMW, CFMoto and KTM. Loncin, who were already a long term JV partner of BMW Motorrad, received an order for 30000 650cc engines. The nature of KTM’s needs in China was somewhat different with an agreement drawn up with top China brand CFMoto for the Chinese mainland distribution of 6 KTM models, utilizing CFMoto dealerships and networks.
Although end of year figures are not yet available preliminary reports suggest that most companies are stabilizing with regard to the sale of 2 wheelers, and enjoying sales increases with 3-wheelers and engines.
Improvement is mainly due to increased efforts in the export markets and less attention paid to the ailing domestic trade which is still critically hit by the motorcycle ban affecting most of China’s urban centers. Among China’s best performing motorcycle companies were Wonjan who enjoyed a rise in sales of 47%. Bonnie Zhang of Wonjan happily reported “the domestic situation has affected the industry badly, so we at Wonjan dedicated ourselves to increasing our marketing for export. It was a difficult decision to make considering the costs involved in mass marketing but it really paid off in style.”
Marketing is one of the aspects of the industry to be discussed at the new China Motorcycle Forum in Shanghai in April. Everyone in the industry has agreed that Chinese companies need to promote their own brands in order to get a grip on European, American and Oceanic markets. This new forum will become an annual fixture on the Chinese motorcycle industry calendar and will invite experts around the world to present their ideas to an audience made up of Chinese motorcycle industry CEO’s and head technical staff.
Winston Guo remarks “China’s motorcycle chiefs are showing a lot of interest in taking advice from international experts, especially in the products that we need to be developing such as marketing, brand recognition, engine systems, EFI and advanced braking. 2014 will be there year that China makes its mark on the western world with the essential help of western motorcycle industry experts.
Another thing we are hoping to promote is the presence of Chinese motorcycle teams in international competition. 2013 saw the first Chinese motorcycle compete in the Isle of Man TT when Britain’s WK racing entered a CFMoto racer in the 600cc category and we are looking to expand on that with the expert advice of FIM.
One of those experts, legendary American motorcycle guru Frank White of ATK America revealed “the quality of Chinese motorcycles is now more than satisfactory for the US market. ATK is currently looking at developing joint ventures to allow Chinese motorcycle companies to market their brands here in the USA. We will offer our full support, including technical support, sales networks and brand recognition promotion as we feel that 2014 will be the year the Chinese finally break into the American market in a big way. American motorcycle magazines have been running the headline ‘the Chinese are coming’ for years now; we feel sure that this year they will be publishing the legend ‘the Chinese are here!’”
One country that has already seemed to embrace the Chinese invasion is the UK. The implementation of the congestion tax in London brought a whole new market to the UK motorcycle retail industry.
British importer Daniel Frost of British brands Lexmoto and Pulse stated “last year saw Chinese motorcycle sales overtake the Japanese unit for unit in the UK. This is mainly down to the general public’s acceptance of the ‘new wave’ of Chinese motorcycles. There are now very good aftermarket services for Chinese motorcycles in Europe and Chinese quality and price make these motorcycles an invincible proposition. Many new riders, especially commuters, have no brand favoritism for Japanese or European brands which means Chinese motorcycles will go from strength to strength on our market.
To conclude, it is apparent that there has been an intrinsic optimism in the Chinese motorcycle industry this year, one that hasn’t been felt since pre 2008. As usual the spring session of the Canton fair will tell us the story of what to expect in 2014 but the Chinese industry isn’t bothering to hold its breath, it’s far too confident now!