White paper

The new passenger car fleet in China, 2014: Technology assessment and comparison, 2014 versus 2010

China, the world’s largest passenger car market since 2009, has adopted a series of fuel-consumption regulations, starting in 2004. If all manufacturers meet their corporate-average fuel consumption targets, the new passenger fleet average in 2020 will decline by 31%. This study observes the passenger car fleet’s characteristics and technology changes by 2014 in response to the Phase III fuel standards. The findings document the development speed of major efficiency technologies, providing the foundation for projecting the potential of future measures in support of policy-making for 2021-2025 fuel consumption standards.

As in 2010, the characteristics of the 2014 domestic and imported fleets remained significantly different. Imported cars were 35% heavier, 10% larger, and 77% more powerful than domestic cars. At the same time, the fuel efficiency of the imported fleet improved faster than that of the domestic fleet as imports’ engines shrank and domestic cars’ expanded.

The market shares of the mini, small, and minivan market segments shrank significantly from 2010 as the medium, MPV, and SUV segments expanded. SUVs became the second-largest subdivision with larger and more powerful models. Reflecting the market shift to larger cars, the 2014 domestic vehicle fleet was 6% heavier than the 2010 fleet. Mini-cars showed the greatest decline in fuel consumption at 15.6%, followed by MPVs, 15.4%, and medium, 14.1%. Minivans had the smallest reduction, 5%.

The Phase III fuel consumption standards successfully encouraged the introduction of advanced engine and transmission technologies. The sales-weighted average fuel consumption of the domestic fleet decreased by 6.5% from 2010 to 2014, or an average of 1.7% annually. Most manufacturers met the 2015 fuel consumption targets in 2014.

However, market shifts to larger vehicles counteracted the effects of advanced technology deployment. The increase in curb weight was faster than the increase in footprint across major manufacturers.

Individual joint venture cases showed that with proper adoption of advanced technologies, fuel consumption can be reduced even as the fleet gets heavier and larger. Therefore, it is suggested that independent automakers should change their strategies and adopt more advanced technologies to further reduce fleet fuel consumption.

China vehicle fuel consumption, weight and size