China's Auto Affair Drives Oil Demand
OREANDA-NEWS. January 14, 2014. Every two seconds, somewhere across China a customer takes delivery of a new car -- part of a consumer buying blitz that will see China add 21 million new cars, trucks and buses to its fleet total in 2014.
Short of a catastrophic economic downturn, a government edict against new car ownership, or draconian traffic congestion charges, a continuation of that growth rate means China will likely have a bigger motor vehicle fleet than the United States by 2020.
Indeed, the combination of a low vehicle penetration rate -- only 85 vehicles for every 1,000 people in China, compared with more than 800 per 1,000 in the U.S. -- and the consumer aspirations of high-income, urbanized households across China almost guarantees it.
As many as five million of the 260 million-plus vehicles on Chinese roads in 2020 will be plug-in hybrids or battery electric vehicles, while others will use fuel cells. Many of the country's taxis, trucks and buses will run on compressed natural gas. There will be multiple fuel-saving aids and financial incentives.
Petroleum demand
But overwhelmingly, passenger cars will still run on gasoline and diesel fuel, which is why Chinese demand for petroleum is the key factor in the global energy outlook for 2014 and beyond.
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