Consumers in China’s Smaller Cities Beginning to Upgrade Their Vehicles

	ECUs, suspension products and exhaust systems are among the most popular performance upgrades in China.

Demand for new cars is forecast to grow most quickly in China’s smaller cities and inland provinces in the coming years. Judging by what SEMA heard from tuners and distributors in those places, so will demand for performance-boosting aftermarket products.

SEMA members can connect with those Chinese companies through face-to-face meetings with distributors at this groundbreaking event. Participating SEMA members will be paired with relevant Chinese buyers in up to a dozen private, pre-scheduled meetings at the SEMA CIAPE China Business Development Conference September 23–26, 2010, in Beijing.

Our research has shown SEMA members that Chinese firms are eager to find new imported, high-tech products to sell, from ECUs to suspensions. The types of cars on which these products are installed range from high-end to sport-compact.

Upgrading ECUs is a new trend in Harbin, the capital city of the Heilongjiang province in far northeastern China, according to a local tuner shop manager who also has seen a burst in demand this year for suspension system products. The manager is so positive about the future of the performance parts industry in China that he has decided to open his own shop.

In China, the so-called second- and third-tier cities, such as Harbin, are huge by U.S. standards. The tier-two city of Harbin, for example, has a population of nearly 10 million. Changsha is also a tier-two city. The capital city of central China’s Hunan province, Changsha is part of a tri-city cluster with a population of more than 13 million.

Demand for performance products is also burgeoning in Changsha, according to the manager of an import and distribution company there. Demand for ECUs is “big and growing,” he said, “and Chinese technology is not good enough. We need to import a lot of these products.”

Exhaust systems is another fast-growing category in the two cities. “It improves the performance, obviously, and your car sounds better, like a race car,” said the Harbin manager.

Audi models are a favorite for ECU upgrades. Audi is the top-selling luxury brand in China, with 160,400 units sold in 2009, according to J.D. Power and Associates.

But the kinds of cars on which performance products are being installed aren’t limited to luxury cars. ECU upgrades for Japanese brands are also popular, said both managers in Changsha. Toyota, Honda and Nissan are all among the top-10 best-selling brands in China.

American brands, however, aren’t mentioned as often as German and Japanese brands. But the manager in Changsha has specifically requested high-performance suspensions for Ford models. The Focus is Ford’s best-selling model in China, followed by the Fiesta and the Mondeo. All three models are domestically produced.

This is just a taste of the opportunities for SEMA members in China.

Introduce your products to Chinese companies at the SEMA-CIAPE China business development conference. For more information, contact lindas@sema.org or visit www.sema.org/china.