6 car buying trends of Indian and Chinese customers revealed

Mei Songlin, Vice-President and Managing Director of JD Power China and Mohit Arora Vice-President of JD Power Asia Pacific weigh in the factors that lead to the car purchase in these two countries. Keep reading to know what the car buying trends of the prospective consumers are in these two countries:

1. Key reasons for purchase

The study reveals that the top three reasons which drive the purchase of the vehicles are the same between India and China. The findings reveal that 63 per cent of prospective buyers in India prefer a vehicle which his recommended by friends and relatives as opposed to 61 per cent in China. Almost 59 per cent Indians emphasise on good vehicle quality as opposed to 53 per cent in China. Fifty-seven per cent prospective Indian buyers prefer a brand which is reliable and has a good reputation as opposed to 48 per cent buyers in China.

2. Information sources that influence automotive buying decisions in China and India

Word of mouth has the strongest influence on both Chinese and Indian consumers while the internet has seen increasing penetration in recent years especially in China. The findings also reveal that in the future, more word of mouth recommendations will be made online in internet discussion forums. According to the survey, 71 per cent of prospective buyers in China rely on internet while considering buying a new car, as opposed to 29 per cent of Indian buyers.

3. Types of websites car buyers visit

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The findings reveal that 52 per cent of Indian buyers prefer visiting manufacturer’s websites as top sources of information for car searches. This means that automakers have to ensure that their websites must be appealing and intuitive. According to the study, the Chinese buyers prefer special websites that are dedicated to automotive content. The findings also reveal that Chinese consumers are open to purchasing vehicles online.

4. Vehicle financing

The research reveals that in India loans have found increasing favour in recent years as a greater proportion of first-time buyers are fairly young and are not able to pay the entire amount in cash. In addition, there is a greater confidence in their earning capacity to repay over the next several years. On the other hand, Cash is the top mode of payment in China, but this mode of vehicle financing is decreasing on a YOY basis, according to the study.

5. First, additional or replacement vehicle

The findings reveal that with the rise of the middle class, many customers in China are buying a car for the first time and this is especially so in tier 2 cities and below. In tier 1 cities, the middle class is ready to upgrade and/or buy a second car. On the other hand, around two-fifths of new car customers in India are upgraders from two-wheelers every year. The research reveals that this buying pyramid is likely to maintain in the coming years.

6. Education level of car buyers

According to the study, new car buyers in India are highly educated and well-informed. Hence, dealerships need to prepare well to receive such customers who are knowledgeable and demanding. Such customers are sensitive that they are making an expensive purchase and will seek to get the best value out of the deal. Chinese car buyers, too, are well educated and better informed of the market, according to the research. However, there are some differences in vehicle preferences by age groups. The findings reveal that consumers born in the 1960s care more about vehicle safety and performance, whereas those born in the 1970s and 1980s are more concerned with vehicle quality. Younger intenders born after 1990 tend to focus more on the vehicle body type than intenders in other generations.