China: The Mc Kinsey 2017 survey of Chinese auto consumers shows they’re demanding more from carmakers.
The survey offers a glimpse of the next generation of China’s car buyers, who, while heavily invested in connectivity, appear less convinced of the need for a personal car. Among their insights:
Cars are no longer essential. Fifty-two percent can imagine life without a car, 36 percent agree it’s not as important to own a car as it was in the past, and 38 percent are willing to give up their cars if they receive free shared mobility in return.
‘Stay connected.’ Asked about their satisfaction with current entertainment and navigation features and services, 10 percent more young buyers than other groups considered their current in-car systems outdated, and 83 percent of them found it “appealing” to have phone-car synchronization.
Shared mobility is rising. Millennials are twice as likely to use car-sharing services on a weekly basis compared to older generations (12 percent versus 6 percent) and are more likely to use peer-to-peer (P2P) car-rental services (14 percent versus 9 percent). Although 22 percent of older drivers are unwilling to share their cars on P2P car-lending platforms, only 11 percent of millennials say the same.
E-commerce is gaining ground. More of the next generation (23 percent versus 10 percent of those over 24 years old) are using online channels to make purchases.
There’s less trust of commercials. Young consumers show slightly lower trust (three to eight percentage points less than older segments) regarding information sources such as dealer call centers, TV commercials, newspaper, and road shows.
Consumers are choosy about services. Seventy-nine percent of consumers see a need for in-car services. They are, however, picky regarding what they want. Sixty-four percent of consumers in China are willing to switch brands if their requirements go unmet—substantially more than the 37 percent in the United States and 19 percent in Germany (Exhibit 7).

% of consumers in China, Germany, and US who are willing to pay for certain in-car connectivity features

Demand for in-car connectivity is much higher in China. A third of the respondents say it is critical to have in-car connectivity, compared with 20 percent in the United States and 18 percent in Germany. Only 11 percent of respondents are not willing to pay extra for an in-car connectivity system, compared to 43 percent in Germany and 30 percent in the United States.
Subscriptions seem to have potential as a new revenue stream. Sixty-two percent of customers in China are willing to pay subscriptions, significantly more than the 29 percent in the United States and 13 percent in Germany. An increasing appetite to pay for content is also emerging in other digital areas, such as online video, where—contrary to many predictions—people are willing to pay for high-quality content. For example, iQIYI, an online video platform, has more than 20 million subscribers today, up from virtually none three years ago.

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