The Great Wall, Terra Cotta Warriors, the Silk Road, Giant Pandas…..and RVs?
As they say on Sesame Street, “One of these things is not like the others.” However, that just might be changing….
We have to admit that the RV industry in China is in its infancy. Out of a population of 1.3 billion, ownership of the multipurpose vehicles totaled just 6,000 by the end of 2011. Conversely, the number is 8.9 million in the US, 6.5 million in Europe, and in Japan, 78,000. “The figure may seem relatively small, but it has doubled and redoubled over the past few years,” said Wang Xudong, senior editor at 21rv. That is making RV enthusiasts in China very hopeful.
Ten years ago, when Wang and his brother founded 21rv, the country’s first professional website dealing in RV-related news, few people in China had any idea what an RV was. In June, a convoy of 15 RVs will head to Europe on a three-month road trip.
The flow of domestic tourists in China reached 2.6 billion in 2011, a jump of 13.2 percent from the previous year, generating revenue of 1,930 billion yuan ($305.5 billion), a rise of 23.6 percent, according to figures revealed by Shao Qiwei, head of the China National Tourism Administration, at a January conference in Guangzhou.
By August, ownership of motor vehicles in China exceeded 100 million. The distance traveled on the nation’s expressways was 74,000 kilometers, second only to the United States with 80,000 km, the National Bureau of Statistics said in February.
In the meantime, a rise in incomes in the major cities has made the future appear even more promising in a country where vehicle ownership has been rising at breakneck speed. Statistics from local authorities show that per capita GDP in Beijing and Shanghai topped $12,000 last year, approaching the levels seen in developed economies, when measured by the World Bank’s criteria.
The figures, and the nation’s increasing love of luxury brands, would seem to indicate that the time is ripe for the Chinese RV sector to expand – and there is plenty of room for growth.
The growing interest in such an undeveloped market from overseas rivals has increased the pressure on domestic players, but their optimism makes them stick with the industry in the hope of becoming pioneers.
But the path to success is likely to be bumpy, and the industry faces a number of potential roadblocks.
For Wang, the most important factors limiting the industry have been the attitudes of policymakers and police, whose stringent policies regarding the vehicles often make ownership of an RV seem more like a pain than a pleasure.
“Vehicles with a displacement of 1.2 liters or higher have been allowed to tow a trailer RV weighing less than 700 kilograms since 1994, according to the relevant traffic laws. But I was fined for driving like that in Beijing about 10 years ago,” said Meng Qiang, an RV enthusiast, who set up his own brand, Sojourner, in 2010.
Although trailer RV fans can still face run-ins with the traffic police, the attitudes of provincial governments across the country seem to be changing, gradually. Policies supporting the development of the industry have been instigated in provinces ranging from frozen Heilongjiang in the north to the island resort of Hainan in the south.
A lack of facilities
Wang at 21rv said there are just a few dozen camp sites in China, and that 80 percent of them are located north of the Yangtze River.
“A decent camp site calls for investment of at least a few million yuan, in addition to the cost of the land,” he said. “Each place is usually priced at 200 yuan a night. Setting the price too low means operators can’t recoup their investment, while setting it too high runs the risk of losing customers.”
Wang Dongping, general manager of the China Travel Service Assets Management Corp, compared the situation with that in Japan, where many camp sites were built by the central government and are operated by private businesses.
CTSAM, a division of China National Travel Service (HK) Group, was one of the few State-owned enterprises to enter the RV market in the early days, helping to develop and operate camp sites.
“I dare say some people can make money by operating camp sites,” Wang Dongping said at an RV forum in August. “But why are we doing this? As a State-owned company, our mission is to build the network first.” He told the forum that CTSAM, aims to build 20 new sites this year, add 50 more in 2013 and increase the number by 500 in 2020.
However, that may all be irrelevant, according to Wang at 21rv. He explained that the official number of camp sites around Beijing is 20, but that only four are actually operational. Some of the land was developed as camp sites so the developers could claim government subsidies, but they were not well-managed. So the customer flow was small and soon the camp sites existed in name only.
A bright future. When?
Given a national motor-vehicle ownership of 100 million versus an RV ownership of 6,000, the growth potential is obvious. The people China Daily spoke to all believe in the industry’s future, but the question is: When will it happen?
The good news is that many observers believe the boom times will arrive in three to five years – the bad news is that people have been saying that for quite a while now.
In 2010, when the first Beijing International RV and Camping Exhibition was held in the southwestern Fangshan district, many insiders were confident that the RV era would arrive soon.
Now, with another exhibition in full swing, many insiders are still struggling with the same problems they faced at the beginning.
“Having a little faith is important,” said Liu Yujiao at Great Wall Motor Co, “Many industries, when put into a Chinese context, grow beyond the international pattern, like the explosion in sales of cell phones and private cars. Perhaps the next pleasant surprise will arrive in an RV.”
Wang Xudong has all the faith in the world. So much so that he named his week-old twins Lu and Ying, after luying, the Chinese word for camping. Allied to that love, Wang has an almost unshakable belief that the future of China’s recreational vehicle industry is bright. Rather like Mr Toad in Kenneth Grahame’s classic children’s book The Wind in the Willows, the wide open road is everything for Wang.
Safford RV….6101 Mallard Rd….Thornburg, VA….540 735 1100
contributions to today’s post courtesy of china daily usa