BMI's Executive Summary

[TOP]

The Sector At A Glance

Key Insights On The Automotive Sector Of Hong Kong

New vehicle sales in Hong Kong were down by 3.6% in the year to September at 25,142 units, although this is still on track to meet BMI's full-year estimate of 34,436 units as recorded in the Hong Kong Automotives Report. A slowdown in sales growth has been widely anticipated given that 2004 represented a post-SARS sales boom, although Hong Kong continues to benefit from its position as an entry point for the booming Chinese market. The Closer Economic Partnership Agreement with China should ensure that trade between the two markets continues to flourish, particularly in the field of automotive components, where Hong Kong has a comparative advantage.

Hong Kong, in its capacity as a stepping stone to the mainland, benefits both through handling and re-exporting of China's output, as well as the provision of key specialist accessories (over a third of Hong Kong's own locally-assembled auto accessories and parts go to the People's Republic). BMI highlights the threat of China's own growing component industry to supply the booming vehicle manufacturing scene, as a possible downside risk to the performance of Hong Kong's industry. However, we are still inclined to project growth of 7% for total component exports by 2010.

The ever-present threat from the mainland's burgeoning market is a significant factor in Hong Kong's ranking of joint 13th in BMI's business environment ranking for the automotive industry in the Asia Pacific region. The composite score of 31 is two points higher than in our previous report, which represents a slight improvement in both Hong Kong's long-term economic and political risk ratings. However, it is the lack of a production industry, which drags on the scores for other criteria, where Hong Kong mostly achieves average or higher ratings.

Looking at the longer term, BMI expects vehicle sales to reach 36,119 units by 2010, representing growth of 5-6% over the next five years. The report also points out that consumption is constrained by higher borrowing costs, and the outlook largely depends on the future path of Hong Kong's monetary policy, which is closely linked to that of the US.

Contents

[TOP]

Chapter 1 – SWOT Analysis

Hong Kong Auto Industry SWOT

Hong Kong Economic SWOT

Hong Kong Business Environment SWOT

Chapter 2 – Regional Market Overview

Table: Asia Pacific Autos Production – Historical Data & Forecasts (CBUs unless otherwise stated)

Table: Asia Pacific Autos Sales – Historical Data & Forecasts (CBUs unless otherwise stated)

Chapter 3 – Business Environment Ranking

Table: Asia Pacific Business Environment Ranking

Economics – Long-term Risk

Politics – Long-term Risk

CBU Output Growth

Vehicle Ownership/Penetration Potential

Regulation

Competitive Environment

Chapter 4 – Industry Forecast Scenario

Table: Hong Kong Automotive Sector Historical Data & Forecasts (CBUs, unless otherwise stated)

Chapter 5 – Macroeconomic Forecast Scenario

Table: Population And Output

Country Snapshot: Hong Kong Demographic Data

Section 1: Population:

Table: Demographic Indicators (2005)

Table: Rural/Urban Breakdown

Section 2: Education & Healthcare

Table: Education

Table: Healthcare: Vital Statistics

Section 3: Labour Market And Spending Power

Table: Employment Indicators

Table: Consumption and Stratification

Table: Wages per year

Chapter 6 – Special Focus: Commercial Vehicles

Country Landscape

Hong Kong Commercial Vehicle Market – Total Registrations

Chapter 7 – Competitive Landscape

Market Overview

Chapter 8 – Company Monitor

General Motors Asia Pacific Regional Overview

Table: GM Asia Vehicle Production 2005 (CBUs)

Table: GM Asia Vehicle Sales 2005 (CBUs)

Profiles

Crown Motors

Mercedes-Benz

Sime Darby

BMI Forecast Modelling

Automobile Industry

Sources

Appendix: Regional Demographic Data

Table- Manufacturing Wages (ave. per annum), US$

Table - Population

Household Spending Per Capita, US$

Private Consumption Per Capita, US$ PPP

Market Size, GDP, US$bn

Competitive Landscape for Asia Automotives: Sample of  
Companies Ranked

[TOP]

Rankings and Competitive Landscapes by production and sales; market share and change on previous year; number of employees, ownership structure and year established. Also includes analysis of company expansion, export and investment strategies.

Network of Automotive Sources

[TOP]

BMI's Asian Automotives Reports are based on an extensive network of multilateral organisations, government departments, automotive industry associations, chambers of commerce and company reports. Information sources include: