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The first US-bound Chinese leisure tour group is set to depart on June 17, heralding a new era in Sino-US relations. Shao Qiwei, head of the China National Tourism Administration (CNTA), will escort the inaugural tour group to Washington DC, the city to host the fourth China-US Strategic Economic Dialogue on the group’s arrival. Shao told a press conference that CNTA is pleased the bilateral tourism relationship is moving in a new, positive direction.

Last December, the two sides signed a memorandum of understanding (MOU) to open outbound tour-group travel from China to the US. The MOU would open China’s market to the US, and such businesses as tour operators, airlines, hotels and banks are expected to benefit.

And after five months of talks, CNTA and the US Department of Commerce reached agreements on the details.

The first phase will last 6 months, during which only 9 provinces and municipalities can organize US-bound tour groups. Group members must be residents with hukou in Beijing, Tianjin or Shanghai municipalities, or Hebei, Hubei, Hunan, Jiangsu, Zhejiang and Guangdong provinces. And domestic tour operators with licenses in the 9 municipalities and provinces to run out-bound tourism operations can organize US-bound tour groups. As for tourists’ US destinations, there are no specific restrictions.

US Commerce Secretary Carlos Gutierrez believes that the increased visitation from China would be helpful in reducing the US trade deficit with China.

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Otis, an elevator company which accounts for 27% of the global elevator and escalator market, plans to invest an additional $100 million to triple its Tianjin plant’s capacity by 2012.

The plant, located in the Tianjin Economic Development Area (TEDA), currently has an annual production capacity of 50,000 machines and 20,000 elevators. With the additional investment, the TEDA plant will have a new automatic production line manufacturing high-rise elevators. With China’s market size reaching 3,000 units per year, China and the Middle East are two major markets for high-rise elevators.

Otis is now focusing its business in China, devoting its production capacity mainly to domestic consumption. In spite of the Chinese government’s curb on speculative investment in the housing sector, the country’s urbanization is still fueling the market’s growth.

Considering China as a market of strategic importance turning into both a huge consumption market and an efficient manufacturing base, Otis is also planning to expand investment in Chongqing, Guangzhou, Suzhou and Northeast China.

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Amid inflation at a decade-high level, China saw a record high of 22% increase in its retail sales in April from a year earlier, as consumers are paying more for basic necessities and are more willing to spend in the face of rising inflation.

According to the National Bureau of Statistics, sales of foodstuffs and beverages climbed 25.3% year-on-year, with spending on grain and edible oil surging by 36.3%.

Paying more for daily necessities, consumers are also encouraged to spend more on durable and luxury goods. The April report demonstrates that sales in furniture, automobiles, gold and silver jewelry increased 37.2%, 25.7% and 41% respectively. Behind the robust growth is the Chinese people’s increasing willingness to consume in a high-inflation environment.

China remains a huge potential market, especially its consumer market, as the Chinese people nowadays grow stronger in terms of their purchasing power and their willingness to consume. For business people and enterprises interested in exploring the Chinese market, BPOVIA Ltd based in China, with its professional consultation and virtual assistance services, is always ready to provide clients with seamless experiences in the process.

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To cash in on the rising demand for luxury jewelry, Luk Fook Group.the Hong Kong-listed jeweler, has put more stores on its mainland expansion schedule this year.

With 335 shops on the mainland, only 9 are self-operated, six more self-operated shops will be opened in first-tier cities such as Beijing and Shanghai this year to generate more profit.

Thanks to the fast growing mainland economy and the rising purchasing power of the middle class, the demand for luxury has shot up, which made the market big enough for Jewelers like Luk Fook Group to expand the number of shops 10 times there, hoping for a 30 to 40% turnover.

On the other hand, robust economy ,increasing wages, and money flooding from mainland has all acted as major boosters to the firm’s Hong Kong business, according to William Wong, CEO of the company, half of the turnover from the retail shops comes from mainland tourists, who always look for the most expensive products.

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L’Oreal SA, the largest cosmetics company by revenue in the world with strong make-up product sales, technology innovation and product value enhancement, aspires to become the leader on the Chinese market in cosmetics and beauty product sales.

L’Oreal entered the Chinese market 10 years ago and now ranks second in terms of market share and sales in the country. Besides its high-end cosmetic brands such as Lancome and Biotherm, it has been focusing on tapping the middle-and low-end mass products. The company purchased Mininurse and Yue-Sai in late 2003 and early 2004, expanding its presence in the hair-care and skin-care sectors. In addition, it has set up three plants in China, producing about 96% of all cosmetics products sold in the country.

In 2007, L’Oreal China saw a strong sales volume of 5.45 billion yuan, an increase of 30% compared with the previous year. Taking up 4% of the company’s global market sales volume, China became one of its 10 most important markets worldwide.

In 2006, L’Oreal accounted for 9.6% of the country’s cosmetics products market and the figure rose to 11.2% in 2007, narrowing the gap with market leader P&G.

Paolo Gasparrini, president of L’Oreal China, has much confidence in the cosmetics sector in China due to the fast increasing per capita income of the Chinese people. “We have a reasonable goal to become the No1 over the next three to five years, if we take our future business expansion plan into consideration,” said he.

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In spite of the unfolding global credit crisis and soaring energy prices, auto sales in China maintained double-digit growth since the beginning of the year. Passenger car sales rose 17.84% year-on-year in the first four months of 2008.

According to the China Association of Automobile Manufacturers (CAAM), sales reached 2.46 million cars, including 1.81 million sedans, 75,500 mini-vans and 141,300 sport-utility vehicles. And the figure for March was unusually large, showing the most rapid year-on-year growth in seven months.

Volkswagen AG’s two Chinese ventures — FAW Volkswagen and Shanghai Volkswagen — continued to top the sales list last month, as well as in the first four months. They are followed by the Detroit-based car maker’s venture with Shanghai Automotive Industry Corp, Shanghai GM. And domestic auto producers sold 463,100 sedans in the first four months, accounting for a 25.46% share of the total sedan sales.

China, the world’s second-largest car market, produced 8.88 million automobiles last year, of which 8.79 million were sold. And this year, auto sales are anticipated to exceed 10 million units, which stand for a 14% full-year sales growth.

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Compared with the fourth quarter last year, sales of smartphone in the Chinese market in the first quarter saw a 4.8% growth.

The average price of a smartphone in China is around 2,470 yuan. Compared with high-end ones, low-end smartphones enjoy much wider popularity among buyers. And smartphone produced by Nokia and Motorola took up 85.9% of the market share.

In terms of sales volume, the market saw a record of 8.24 million units in the first quarter, accounting for 19.1% of all types of cellphones sold on the domestic market. And sales revenue stood at 20.4 billion yuan in the first three months, registering an increase of 7.6% over the same period last year.

The Chinese consumer market is in full swing in recent years, which is to a large extent attributable to the rapidly developing economy of the country and growing purchasing power of the Chinese people. Such a robust and huge potential market naturally attracts business people around the world like a strong magnet. For any businessman who is interested in the Chinese market and looking for assistance to facilitate business processes in the country, BPOVIA Ltd based in China, with its excellent virtual assistants and professional consultation services, can always be the source.

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A company to build large passenger aircraft was unveiled on May 11th in Shanghai, a major step closer to the country’s ambitious goal to produce homemade jumbo jets.

The new company has a registered capital of 19 billion yuan. The State-owned Assets Supervision and Administration Commission is the largest shareholder with an investment of 6 billion yuan for a 31.58% of the shares. Other shareholders are Shanghai Guo Sheng (Group) Co Ltd (26.32%), China Aviation Industry Corporation I (AVIC I) (21.06%), and China Aviation Industry Corporation II (AVIC II) (5.26 %).

The company will set its focus on five sectors—aircraft development, system integration, marketing, customer service and certification. And Commercial Aircraft Corporation of China Ltd (CACC) will undertake the chief responsibility of researching, developing, manufacturing and marketing the aircraft.

Within the first few years, CACC plans to finish delivery of ARJ21 aircraft—the first homegrown regional jet—and establish an operating system and train talents. The 70- to 90- seat ARJ21-700 came off the production line in Shanghai last December, and will start its maiden flight in the autumn.

Besides helping to improve the country’s independent innovation capabilities, the large-jet program is also of great significance in meeting the rapidly expanding domestic civil aviation market.

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According to a report by Beijing-based CCID Consulting, sales of flat screen TVs in China soared 71% year-on-year to 2.98 million sets in the first quarter.

In terms of sales volume, Samsung ranked first in the liquid crystal field, followed by Hisense and Skyworth. Sales of 32-inch liquid crystal flat screen TVs took up less than 35% of the total while sales of 40-inch and above sets exceeded 35%. And it is estimated that flat screen TV sales will total 9.26 million sets this year, 11.57 million in 2009 and 15.71 million in 2010.
Regarding revenues, sales of flat screen TVs grew to 60.6% year-on-year to 24.64 billion yuan.

“The surge owes much to the upcoming 2008 Olympics as consumers brought forward their purchase plans and favored bigger sets,” CCID senior analyst Tian Xiaona.

China’s consumer market is rapidly expanding due to the increasingly strong purchasing power of the people. This unfolds great opportunities for business people world wide. For all those interested in exploring the Chinese market, BPOVIA Ltd based in China can always be the source. With our talented team offering consultation and virtual assistant services, our clients can expect the most professional services in the business process outsourcing circle.

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According to statistics released by the China Association of Automobile Manufacturers, China imported 103,200 vehicles in the first quarter this year, a 74.54% increase year on year.

A total of 28,534 off-road vehicles with 3.0-liter engines or above, with an average unit price of $40,900, were imported in the first quarter, soaring 262.57% compared with the same period in the previous year.

In addition, the country also imported 16,624 cars with 3.0-liter engines or above during the period, up 75.28% year on year. The average unit price reached a higher $57,900. Imports of luxury auto brands such as Lexus, Mercedes-Benz, BMW, Volkswagen, Volvo and the latecomer Infiniti, increased a sharp 82% in the first quarter.

“Buying imported vehicles as a second option is a growing trend among affluent people,” said Xu Di, director of marketing department at China Automobile Trading Co Ltd.

In terms of sales, a Guangzhou-based Audi dealership witnessed a 230% year-on-year sales growth in the first quarter. Huang Weiwen, marketing director of the distributor, pointed out the luxury car market is slightly affected by economic depression and high-end consumers’ consumption temptation is also not very seriously impacted by the gloomy stock and property markets.

For businessmen around the globe, China, with the strong purchasing power of consumers, means a huge potential market to tap. To facilitate your businesses in the country, BPOVIA Ltd is always ready to provide you with the most professional services in consultation and virtual assistants.

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