French automaker Renault’s senior vice president, chairman of China Francois Provost remains confident in the Chinese market despite the market downtrend.
China has been struggling to sell new cars since the middle part of last year. Therefore, Renault expects its full-year sales to fall by around 5%. But Provost showed confidence during his interview with CNBC’s Geoff Cutmore and Arjun Kharpal at the World Economic Forum in Dalian, China. Provost said, “we remain confident about the long-term trend for the Chinese market”.
The senior executive said the hesitation of customers to buy new cars may be due to uncertainty surrounding the trade dispute between the U.S. and China.
According to a Reuters report, China Association of Automobile Manufacturers recorded a decline of 16.4% in auto sales in May, extending the losing streak into an 11th consecutive month.
Trump-Jinping Meeting
U.S. President Donald Trump and Chinese Xi Jinping had a meeting during the G-20 summit in Japan last Saturday. The two powerful leaders agreed to stop further tariffs on each other’s goods and to continue negotiation talks to reach a trade deal favorable to both countries. Provost hoped that the positive meeting would lift the Chinese automotive market.
Nevertheless, Renault maintains three joint ventures in China and plans to sell 550,000 vehicles in the country in 2022. The company sold more than 216,000 vehicles in China last year. That’s 3 times more than its sales in 2017.
Renault is focusing on China’s electric vehicles market. In 2018 alone, sales of electric vehicles increased by 62% to 1.3 million vehicles. The number could reach 1.6 million in 2019, according to the forecast. Provost believes that the electric vehicle market will grow a lot in the coming years” because of strong government support and growing consumer confidence.
Also read: US and China Agree on Tentative Trade Truce Ahead of G20
