This article comes from interface News APP , author: Hou Zhuojia

According to the data of the China Automobile Association, in 2019, the production and sales of passenger cars in China completed 21.36 million and 21.444 million units, respectively, and the production and sales dropped by 9.2% and 9.6% year-on-year. “.

Continue to refine the data. We can find that domestic Chinese brand passenger car sales in 2019 were 8.407 million, a year-on-year decrease of 15.8%. Although it still occupies the first place in the passenger car market share of various factions, its share It has fallen from 42.1% in 2018 to 39.2%. Even among the top 15 car companies with Chinese brand sales, only Great Wall, Chery, FAW and Shaanxi Automobile achieved positive growth.

This “cold winter” has also swept the new energy vehicle market, which is in a period of rapid growth. Affected by the decline of new energy subsidies and the blowout of fuel vehicle sales when the emission standards were switched, the production and sales of new energy vehicles last year were 1.242 million and 1.206 million, respectively, a year-on-year decrease of 2.3% and 4.0%.

In fact, the main logic behind the logic is relatively simple. After nearly 30 years of cultivation in the market, different car companies are closer to the preferences of Chinese consumers, and consumers have become more aware of cars through the Internet and other channels. Coupled with the more mature market-oriented operating system and the trend of domestic consumption structure upgrade, the market’s “invisible hand” will surely screen out automotive companies with more product power and brand power.

Subsequently, an outbreak that swept across the country made the slightly-improved domestic auto market again facing a more uncertain situation. So, according to this market trend, Chinese brands can only “stand tight” in the increasingly severe domestic market?

Cui Dongshu, secretary general of the Passenger Car Market Information Joint Committee, told Interface News that from January to December 2019, China exported 1.22 million vehicles, an increase of 6% from 1.15 million vehicles in 2018. The total export trade volume for the year reached 15.2 billion US dollars, a year-on-year increase of 3% compared with 14.7 billion US dollars in 2018, and export performance was relatively stable.

In the 19 years from 2001 to 2019, China’s total automobile exports (passenger cars) realized from 0.35 million to 1 million Car Daguan (Source: China Automotive Industry Yearbook) .

As of 2019, there are already more than ten Chinese companies including Chery Automobile, JAC, SAIC Passenger Cars, Brilliance Automotive, SAIC-GM-Wuling, Changan Automobile, Great Wall Motor, Geely Automobile, Dongfeng Fengshen, Huatai Automobile, and Lifan Automobile. Brand car companies have successively exported overseas.

In the 2019 vehicle export data, new energy vehicles stand out, and the export of new vehicles reached 254,000 throughout the year, which is a growth rate of about 39% compared with 147,100 in 2018. Among them, pure electric cars and off-road vehicles occupy the absolute main force of exports, reaching 240,300 units; plug-in hybrid cars and off-road vehicles also reached 12,400 units, and the overall increase is very satisfactory.

Indeed, Chinese car companies entering 2019 all seem to “smell” the opportunities in overseas markets, and have made great efforts overseas. In April last year, SAIC Group first set the target for the overall vehicle sales in the overseas market to 350,000 units. Also in April, GAC Passenger Vehicle, an autonomous segment of GAC Group, signed an agreement with Russian dealers to officially enter the Russian market;

In June, Great Wall Motor ’s Tula factory in Russia was officially completed and put into production; in September, Chery Group and Deutsche Post subsidiary signed a memorandum of cooperation to jointly establish a joint venture to enter the electric logistics vehicle market; at the end of the year, Changan Automobile was exposed A plant is planned in India and a suitable location is being sought.

In 2020, Great Wall Motor has reached an agreement with General Motors on the acquisition of GM ’s Tarigang plant in India and announced its official entry into the Indian market. SAIC Group plans to enter Malaysia, Vietnam, Myanmar and other ASEAN countries.

It is worth noting that, unlike the earlier choice of the CDK method and the vehicle export method, more and more Chinese brand car companies are adopting local construction methods to seize overseas markets.

In 2011, SAIC Group’s “Going Global” strategy began to be built. In 2017, SAIC Group invested 3.275 billion yuan to acquire and transform GM’s HALOL plant in India to enter the Indian market. In July of the following year, SAIC Group announced the establishment of a plant in India to produce new energy and intelligent connected passenger cars, and unified use of the “MG MG” brand.

Chery Automobile, an old export car company, also formulated a new “Go Global” strategy in 2014, and actively deployed in emerging markets such as Brazil and Russia.

In 2018, Chery Group’s plant in Algeria was put into operation and the Brazilian plant resumed production. Proactive planning and management of local factories and distribution channels were implemented. At present, Chery Group has established sales networks in more than 80 countries and regions such as the Middle East, South America, Africa, Russia, and ASEAN. The Group exported 96,000 passenger cars throughout the year.

Great Wall Motor has gone faster in recent times. In 2019, Great Wall Motors exported more than 65,000 vehicles, a year-on-year increase of 38.69%. In addition to the newly-launched Tula factory in Russia and the India-based Tarigaon factory Great Wall Motor has basically sorted out two relatively clear routes to the sea. The Haval and Great Wall pickup series have entered the markets of developing countries in Asia, Africa and Latin America. The WEY brand will focus on Western European and North American markets in the future. The products that are expected to enter the Indian market in the future will be the mid-range SUVs of the Haval brand and the Great Wall pickup series.

As for car companies such as Geely Automobile, Foton Motor, BAIC Group, and Lifan Motors, they have more or less adopted CDK and SKD methods to plan factories and sales channels to continue to increase their overseas markets.

By combing, we also found that these Chinese brands have one thing in common, which is to target markets in developing countries such as Asia, Africa, and Latin America.

According to the China Automotive Industry Development Report (2018) “” shows that the proportion of the top five export destinations of the entire vehicle exports in 2017: In addition to 34.10% of other countries and regions, the top exporter is Iran with 23.5%, Bangladesh, Chile, Mexico, Vietnam, and the United States were 7.90%, 5.80%, 5.20%, and 5.00%, respectively.

According to the statistics of Tianjin Port in 2019, China’s auto exports are mainly in Latin America, Australia, Southeast Asia, Russia, the Middle East, North Africa and other regions, such as Bangladesh, India, Chile, Algeria and other developing countries. Judging from the price and positioning of exported products, Chinese brands are still stuck in the “low-price” product strategy.

From a broader perspective, in recent years, domestic mainstream automobile companies represented by SAIC Motor, Great Wall, Chery, etc. have entered the markets of developing countries, which is similar to the large-scale entry of Japanese brands in Southeast Asia and Asia, Africa, and Latin America in the late last century. Advanced manufacturing countries have reduced the dimensionality of underdeveloped regions. However, the low unit price of Chinese brand products and the small size of the export market are also indisputable facts.

The Foreign Trade Department of the Ministry of Commerce stated in the report that there are still some gaps in China’s auto trade in terms of export scale, added value of products, international operations, and market layout. The average unit price of China’s auto exports in 2018 was only 15,000. US dollars.

Taking Great Wall Motor as an example, its top 5 overseas markets are South Africa, Russia, Chile, Saudi Arabia, and Australia. However, the overall volume of these markets is relatively small, and the largest Russia and Australia have only exceeded the one million mark, and the overall consumption structure is relatively high-end.

So Great Wall and even other Chinese brands need to compete with mainstream multinational car companies such as Toyota and Volkswagen here, which shows that the market development is more difficult.

In addition, how Chinese brands fit into local culture and build consumer confidence is equally important.

Zhao Aimin, party secretary and deputy general manager of Shanghai Automobile International Trade Co., Ltd. once said: “In the process of internationalization of any group and any product, it must undergo a process of close integration with local culture, not to say. This This kind of cultural adaptability is the most difficult for us to go abroad. “

At present, SAIC, Great Wall Motors and Chery Automobile have adopted localized talent strategies, especially the sales channel side and production management side.

He also said: “The auto industry not only sells products, but also depends on the service.” In response, some auto industry analysts said that the biggest obstacle for Chinese companies to enter overseas markets is to target local consumers to new Chinese cars. Doubts about product quality and reliability, such as Huawei, Xiaomi, etc.The initial entry of mobile phones into overseas markets is similar. In order for Chinese brands to compete with international big-name companies to obtain those buyers with brand awareness, they need to undergo a series of systematic construction.

Finally, on the way to the sea, Chinese brands must pay attention to local industrial protection policies, tariff policies, currency exchange rate issues, and potential geopolitical crises.

From the perspective of the development path of the domestic and foreign auto industries and the global economic situation, it is inevitable that Chinese brands will go to overseas markets. As for how the “export” road will be smoother, Chinese brands will also find the best in past experience. answer.

This article comes from interface News APP , author: Hou Zhuojia