Car Modification - Where the Market's Going?

2011 will be an interesting year for the Chinese car market, Tier 1 cities will be cracking down on the sales of new cars to try and reduce the gridlock on roads, meaning that in Beijing only 1/3 the number of cars will be allowed to be registered in the city compared to the year before.

Shanghai, Shenzhen and Guangzhou are also struggling with the burgeoning mass of vehicles on their streets and as such may also implement strict controls on new model sales or alternatively impose congestion charging and "alternate day" policies (where you can only drive you car on Monday, Wednesday and Friday or on Tuesday, Thursday and Saturday) and these controls will impact on car sales too.

Of course it's not all doom and gloom for the country's dealers there will be plenty of capacity increase in the Tier 2, 3 & 4 cities which are the focus of the next decade's economic investment program. But in the Tier 1 cities there will be a definite move away from new vehicles, creating large opportunities in the car modification and customisation market to enable owners to maintain the appeal in older models. Companies like AC Schnitzer and Tech Art are already on the scene and have had a reasonable amount of success already.

Hamann, the German specialists in a wide range of top quality cars for both body kits and tuning are also planning a launch in the country very soon, and rumours suggest that they will launch almost simultaneously in Shanghai and Beijing later this year with a rapid roll out plan to build 15 dealerships in the next following 2 years.

The drive for individualism in a country where it is difficult to distinguish yourself (housing is fairly uniform, as are offices and manufacturing facilities) means there are great opportunities to develop a strong business modifying motors and enabling bespoke "look and feel" for even very high-end cars.

The country is now the world's largest consumer of luxury cars, at the recent Guangzhou car show Bentley sold 8 cars in 3 days! So while you couldn't call these vehicles "commonplace" they are found in greater abundance than anywhere else. There has already been strong interest in the Hamann product range for enabling a more unique look, to allow businessmen to distinguish themselves from their peers. Rumours are that they have already pre-sold their first Bentley, despite being a few months away from launch, and having not yet opened a sales centre in the country.

It will be interesting to see how the market in China develops, and most of all who will make use of the opportunity to become the first Chinese manufacturer of body kits for the high end market. With the government in Dalian offering high levels of subsidy for auto manufacturing projects, it has to be just a matter of time.