Chinese Drivers Discover The SUV

SUV at China car showREUTERS/Tyrone SiuStaff uncover a Great Wall Motors Haval M4 mini SUV during the media preview of the 10th China International Automobile Exhibition in Guangzhou November 22, 2012.

For the first time ever, sport utility vehicles account for more than 20% of all market share by vehicle type in China.

“[SUV] market size boomed by 46% [year-over-year] to 240,000 units in July, recording the highest monthly market share of 20.8% of the total [passenger vehicle] market,” say Morgan Stanley analysts Sheng Zhong and Frank Xu. “This is driven mainly by low and luxury SUV segment, which both rose over 60% [year-over-year] last month.”

In July, 239,683 of the 1.15 million vehicles sold in China were SUVs, which contributed 7.5% percentage points to the 13.5% overall sales growth rate last month.

The chart below shows how the SUV’s market share has evolved over the past several years. In 2006, it stood at only 5.4%, a quarter of where it is today.

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