In 2007, the washing machine market in China maintained a steady growth and sales of high-end laundry appliances grew rapidly. Data from the Chinese National Bureau of Statistics show that the total output of washing machines was 25.57 million units from January to September 2007, about 19% more than 2006. The degree of brand concentration was also rising. Monitoring data from Sino Marketing Research Co. shows that, from January to August 2007, the domestic market share of the Top 10 brands was 90.67%. The combined market share of the top three brands—Haier, Little Swan, and Royalstar—was close to 60%.
Multinational companies were very active in China’s washing machine market as well. According to Sino Marketing, brands such as Panasonic, Siemens, LG, Sanyo, Whirlpool, and Samsung have entered the Top 10 in market sales.
Cylinder (front-loading and horizontal-axis) washing machines have been actively promoted for the last two years in China, and sales of these higher-priced appliances grew substantially in 2007. Industry insiders believe this was related to the overall growth of the Chinese market consumption. China’s Energy Efficiency Labeling System, effective since March 1, 2007, also helped to promote cylinder washers, which offer a higher energy-efficiency rating. According to China Market Monitor Company, Ltd., sales volume of cylinder washers rose 17.7% and sales value rose 24.12% on a year-on-year basis during the January-to-September 2007 period.
By contrast, the growth of the twin-tub, semiautomatic washing machine category was rather weak and the market share of single-tub washing machines fell significantly. The proportion of sales and market share of twin-tub, semiauto washing machines grew by only 1.77 and 6.94% respectively, while single-tub washing machines dropped 13.81 and 19.95% respectively.
Product design resources are increasingly geared to developing high-end washers for Chinese markets, and the more expensive combination washer-dryers with large capacities are becoming more favored by Chinese consumers.
Despite the rapid growth of cylinder washing machine sales, the industry believes that, given China’s current consumption level and its large, diverse market, agitator-driven appliances will remain the dominant washer configuration for a relatively long period, with agitator washing machines also showing growth. China Market Monitor Co.’s January–July data show that the sales of high-end agitator washing machines priced higher than 2000 yuan grew 44% over the same period last year. In fact, Sanyo plans to stop production of agitator washing machines less than 1500 yuan and increase the proportion of high-end products in 2008. Hangzhou Panasonic also plans to increase production of large-capacity washing machines (above 6 kg) and premium agitator washing machines. The average price of Panasonic’s products will increase to more than 2000 yuan.
Mainstream washing machine brands are moving increasingly into rural markets. This, along with the general upgrading of washer consumption, has made market conditions tough for smaller-sized producers of low-end twin-tub, semiauto, and single-tub appliances. Rising raw-materials prices and market competition compelled about a dozen of those OEMs to withdraw from the market or invest in other areas in 2007.
China’s exports of washing machines are gradually rising. Statistics from the Chinese General Administration of Customs show that, from January to August 2007, China’s export value growth of washing machines exceeded the export volume growth. The export volume totaled 8.616 million units, up 22.27% over the same period last year and the growth scale declined, while the export value rose 28.05%, an increase of 0.81% over the same period last year.