China's sport-utility vehicle market is expected to post slower growth this year, according to estimates from the China Association of Automobile Manufacturers.
China's sales of SUVs are set to hit 11 million this year, up 20 percent annually, according to the China Association of Automobile Manufacturers. This growth is a sharp slowdown from the 44 percent growth of the SUV sector last year.
"2017 will become a starting point for the slowing growth of sport-utility vehicles," said Xu Changming, director of the Information Resource Department at the State Information Center. "Only companies with competitive SUV models can win market share."
Sales of SUVs surged 16.8 percent to 4.53 million units in the first half of this year, data from CAAM showed. The growth rate is below the association's prediction of 20 percent expansion this year.
While the growth of SUVs is slowing, domestic makers' market share rose.
"Domestic manufacturers have contributed a lot to the growth of the SUV sector in the first half of this year," said Shi Jianhua, deputy secretary-general of CAAM.
The market share of domestic vehicle makers took up 59.6 percent of the total SUV sector in the first six months, 3.6 percentage points higher compared with the same period last year, data from CAAM showed.
This development in the domestic vehicle sector is down to cost control measures and the introduction of new models into the market, Shi said.
"Domestic brands are still leading in market share and have the potential for further growth," said Zhang Zhiyong, an independent auto analyst.
While the growth rate has slowed down, the market share of SUVs is climbing, which means more and more people are choosing these vehicles.
The market share of SUVs rose to 40.2 percent in the first half year, up from 16.7 percent in 2013, data from CAAM showed.
The rise is driven by rising demand from young and middle age buyers in third and fourth-tier cities in China, according to Shi.