Description

The Chinese fleet leasing market is in the early stages of development. New company car registrations in China are expected to grow slowly mainly due to fierce competition from mobility service providers offering instant and convenient private car hailing services. Moreover, the country has a well-developed public transportation network that constitutes the primary mode of transport for its workers. As participants continue to tweak their business models to gain a stronger foothold in the Chinese fleet leasing market, the aforementioned factors are expected to present certain opportunities and pose some challenges for growth.

Vehicle leasing is seen as a solution given the growing number of challenges faced by companies with regard to their mobility needs. Amongst others, these include challenges associated with vehicle funding, fleet maintenance, and, more importantly, residual risk handling. Existing market conditions are propelling businesses to focus on their core products/services by outsourcing all support activities. Mobility is a significant department—starting from fleet purchase to remarketing at competitive prices—and unless properly managed by an expert team, it can pose issues affecting each of the different segments in the value chain (such as cost spikes, utilisation mismatches, irregularities in fleet maintenance, and risk of dips in residual value). Leasing the fleet enables hassle-free mobility, on-demand mobility, and fleet after-service facilities, amongst other benefits. This has driven the growth of the leasing market, given it a structure, and regulated the ecosystem.

This study sheds light on the market size across passenger vehicle (PV) and light commercial vehicle (LCV) segments and provides sales/parc data for the total market and fleet and company car (true fleet) segments. The company car segment is discussed in detail, with a focus on the actual development and the growth potential of financial lease, operational lease, and outright purchase. The analysis takes into account both historical data and current market conditions and also draws on insights and opinions from market participants to provide a five-year outlook on growth opportunities (over the 2018–2023 period). In addition to market data (PV and LCV) for both new registrations and portfolio, the study provides actual competitor data (portfolio) for the leading leasing service providers in the country. Competitor data is available for both the leasing segments (operational and financial) for the base year, 2018.

The evolution of any industry depends on factors such as transformational trends linked to the macroeconomic dynamics of the region and emerging business models that reflect innovation in mobility solutions (e.g., rental, car sharing, integrated mobility, and alternative powertrain). The study covers these evolutionary trends that are expected to shape the market. It also highlights the growth opportunities that leasing service providers and other companies sharing the leasing ecosystem need to leverage and the strategic imperatives that aid in their pursuit of growth and success. Overall, the study provides a 360 degree, region-specific understanding of the leasing space and offers a detailed account of the key trends, market overview, and outlook.