China's automobile modification market is accelerating development and has broad prospects in the future
According to the latest data from the Ministry of Public Security, by 2022, China's car ownership has reached 390 million. With the continuous growth of car ownership, the trend of younger car owners is accelerating, and the personalized needs of car owners are also increasing. In the future, the automotive modification market will be driven by both market demand and policy guidance, ushering in new development opportunities.
The scale of China's automobile modification market was only 45 billion yuan in 2014, and increased to 106.6 billion yuan in 2019. It is expected that the market size will reach 217 billion yuan by 2025, with sustained and rapid growth. Currently, the conversion rate in the Chinese automotive market is only 2%, while the conversion rate in the European and American automotive industry countries, especially in Germany, has reached 60%. Based on this calculation, the domestic automotive market has huge growth space, and is currently only in the "starting" stage.
Policy orientation, market regulation, and industry advancement
The automobile modification industry is first limited by relevant policy constraints. Compared to the policies of major foreign automobile countries, domestic automobile modification policies have more restrictions. However, in recent years, China has successively introduced a series of regulations and policies for automobile modification, gradually improving the policy guidance for the automobile modification market, providing a policy basis for the development of the automobile modification industry, and also indicating the determination of the government to promote the development of the automobile modification industry.
In 2019, the "Work Regulations for Motor Vehicle Inspection (GA801-2019)" was issued, explicitly supporting vehicle modification from the national policy level. In 2021, the "Guidelines for Promoting Automobile Consumption in the Commercial Field" was issued, pointing out that China should develop the automobile modification market in an orderly manner according to law, and establish a safe and standardized automobile modification process. In 2022, the Automotive Modification Standards Working Group of the China Association for the Promotion of Consumer Product Quality and Safety was established. In the same year, the Opinions on Further Releasing Consumption Potential and Promoting the Sustainable Recovery of Consumption were issued, which required the establishment and improvement of a management mechanism for the automotive modification industry to accelerate the development of the automotive aftermarket.
Coordination between front and rear decoration in the modification market, diversified development
Currently, the automotive modification market is divided into customized modification, authorized modification, and consumer modification. For example, the off-road SUV model Tank 300 launched by Great Wall Motors has cooperated with some modification brands before leaving the factory, and has launched multiple customized modification models, including the Tank 300 Cyber Edition, the Tank 300 Fenglin Iron Horse Edition, the Tank 300 Ranger Edition, and so on. The modified version of the vehicle is not only a visual change in appearance, but also has different emphasis on off-road performance. It can be said that each version is a highly personalized modified product, which is highly praised by owners. According to statistics from relevant institutions, the sales of customized and modified vehicles increased by 560% year-on-year, from 14845 in 2021 to 98227 in 2022.
Consumer modification focuses on the automotive aftermarket, providing personalized modification services for car owners through the convenience of appearance, interior, performance, etc. According to survey data from the China Automobile Industry Association, modification projects such as film application, car body color modification, and upgrading of car audio equipment account for 85% of the entire automobile modification market. In the current market, the consumer modification market is centered around post 80s and post 90s car owners, with an average budget of 10% of the vehicle price. The main market is concentrated in tier 1 and tier 2 cities, but with the development of the modification market, it will be extended to tier 3 and tier 4 cities in the future.
Market issues need to be resolved, and the industry has broad prospects for development
Automobile modification business enterprises need to be guided by standardized standards. Currently, many enterprises engaged in modification business mainly focus on automobile maintenance in the industrial and commercial registration, but the actual business of modification is not accurate in the elite range, which also leads to the lack of market supervision. Many companies that do not have the ability to modify are engaged in the modification business, and the inability of modification companies with professional and technical capabilities to obtain legal identities has become a major pain point in the industry.
In addition, there are currently no unified quality requirements for automotive parts and components in the field of automotive modification in China. The price of automotive parts for modification, especially those involved in performance modification, is much higher than those used for after-sales maintenance of automobiles. The same brand premium problem is serious, leading to a prominent problem of counterfeit and inferior products
The above two issues are only a relatively wide range of issues in the current market. It has been said that the domestic automotive modification market is truly in its infancy, and the corresponding regulations and market environment will gradually improve during its development and growth. With the development of China's automobile industry and the improvement of technology, the penetration rate of automobile modification has gradually increased, and the industry is developing towards personalized customization of automobile products, multi-functional application of automobile products, intelligent application of automobile products, etc. In the future, as the number of users in China's automobile modification industry increases and the demand increases, the industry has a broad development prospect.