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China's US$16.3bn animation industry expected to decline

  • Staff Reporter
  • 2013-06-04
  • 10:37 (GMT+8)
Popular cartoon characters at the 5th China International Comics Festival in Guangzhou last year. (Photo/CNS)

Popular cartoon characters at the 5th China International Comics Festival in Guangzhou last year. (Photo/CNS)

Eighty-five percent of the enterprises in China's animation industry, estimated to be worth more than 100 billion yuan (US$16.3 billion), have suffered losses amid dwindling production of made-for-television animated films, Guangzhou's Southern Metropolis Daily reports.

A State Administration of Radio, Film and Television report said that 395 television animation productions, totaling 3,716 hours, were produced last year, a decrease of 40 productions, or 14.66% year-on-year, with the production of domestic TV animation seeing a decline for the first time since 2008.

Production is expected to fall further to 2,500 hours this year, the report said, citing an industry insider. The report showed that a total of 580 television animation productions, totaling 7,850 hours, were planned last year, with half of the projects aborted.

The decrease stems from a series of measures put in place by the government that prioritize high-quality made-for-television films. This year, China's annual animation production capacity was worth around 80 billion yuan (US$13.04 billion), less than one-third of the US-based Walt Disney Animation Studios, said Wang Ying, an industry expert.

Currently, more than two-thirds of China's provinces have introduced policies to support the development of the animation industry, through subsidies, tax rebates and exemptions. However, the outlook is still grim for the animation industry, with average production costs for a 3D animated film at 30,000 yuan (US$4,900) per minute. Even if local governments provide subsidies worth 4,000 yuan (US$652) per minute, the producer would still suffer losses, said Kong Xianglin, chairman of Guangdong-based Benko Animation Chain Management.

Several companies are expected to withdraw from the animation market soon after seeing a decline in production and profits, the Southern Metropolis Daily said.

According to an industry report, the number of production companies in the industry was numbered at 215 last year, down by nine from the previous year.

There are a total 42,000 animation companies currently operating in China, with the large number driven by producers of related derivative products, such as books, toys, video and audio products, and stationery, the paper said.

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