“Are Chinese brands overtaking European car brands?” Switzerland’s largest circulation newspaper “Glimpse” reported on the 19th that at the Paris Auto Show, the booths of two Chinese companies, BYD and Great Wall, were particularly popular, and Chinese automakers imitated Gone are the days of popular Western models, poor workmanship or dealing with crash test scores, and new brands from China are entering Europe so fast that European brands may feel “scared”.
From January to September this year, Chinese auto companies exported 2.117 million vehicles, a year-on-year increase of 55.5%. The new energy vehicles that “wake up early and wake up early” are even more outstanding, with exports of 389,000 units, a year-on-year increase of 1 times. After the export volume reached 1 million in 2010, it did not exceed 2 million until last year, and this year is expected to approach 3 million. What does this explosive growth depend on? Can it prove that China has become a powerhouse in the auto industry?
The advantage lies in the “innovation chain”
In addition to the surge in export volume, “the change in export structure is another feature of China’s automobiles’ going overseas this year.” Fu Yuwu, honorary chairman of the Chinese Society of Automotive Engineers, told the Global Times reporter, “From the perspective of models, passenger cars Exports account for a large proportion, and from the perspective of exporting countries, the European and American markets have made great breakthroughs.” According to data from the China Association of Automobile Manufacturers, from January to September, passenger cars exported 1.696 million units, a year-on-year increase of 60.1%. The top three markets for China’s new energy vehicle exports are Belgium, the United Kingdom and Thailand.
In Europe, China’s new energy vehicle boom started in Norway, then to large auto markets such as Germany, France and the UK. BYD will launch the new car in Denmark, Germany, the Netherlands and Sweden later this year. Great Wall will also launch new cars in Germany and other European countries. German auto media Auto Motor Sport conducted a survey on the entry of Chinese cars into the European market and found that a total of 16 brands have entered or are entering Germany. Lynk & Co, SAIC Maxus, SAIC MG, Euler, Polestar, Celis, Swim and Wei brand. In analyzing the reasons, German TV 2 said that Chinese auto companies took advantage of the production capacity of the Chinese market and took advantage of China’s well-functioning auto market to bring their products to Europe. European car companies “scared off” consumers by failing to deliver new cars on time due to a lack of spare parts.
German TV 1 believes that Chinese auto companies can open up the European market first by relying on modern technology. “As the industry shifts to electrification, Chinese automakers see an opportunity to expand into Europe,” said Dudenhof, an economist known as the “Godfather of Automotive”, as Germany’s leading internal combustion engine technology is withdrawing from the market. This is also confirmed by the 2022 Electric Vehicle Report published by the German Automobile Management Center (CAM). The study examines the innovation strength of mainstream automotive groups. As a result, Tesla remained at the top of the list, Chinese companies such as BYD and Geely entered the top ten, and BAIC, Great Wall, NIO and Xiaopeng also entered the top 20.
Fu Yuwu believes that the advantage of this “going overseas” lies in the “innovation chain”. He told the Global Times reporter: “Why do international companies such as CATL, BYD, and Horizon appear in China? We used to talk about the whole vehicle supply chain, but now it should be called the ‘innovation chain’. China focuses on the development of electrified and intelligent vehicles. , There are many new start-ups. This is unprecedented. 2022 will be an inflection point for China’s auto industry, and the high-quality development of China’s auto industry has reached a new stage. This is encouraging.”
The difficulty lies in truly globalization
German TV 1 said in a report that Chinese new energy vehicles have a very good chance of gaining a foothold in the European market, because these products have dominated China’s own market. According to data from the China Association of Automobile Manufacturers, from January to September, the production and sales of new energy vehicles in China reached 4.717 million and 4.567 million respectively, a year-on-year increase of 1.2 times and 1.1 times respectively, with a market share of 23.5%. Wang Qinghua, general manager of joint research of JDPower China, a global consumer insight, market research and consulting agency, told the Global Times reporter that according to their research, Chinese domestic consumers have a better evaluation of electric vehicle product design, and in intelligent To a certain extent there is more recognition. According to data from JDPower, the reasons for Chinese consumers to buy new energy vehicles are less than in the past, such as policy incentives and license plates, and the reasons for purchase are returning to the car products themselves.
This month, NIO held a press conference in Berlin to announce the official launch of its European plan. Qin Lihong, co-founder and president of NIO, told the Global Times reporter that the world‘s major auto companies have been slow to respond to electrification transformation, which gives us an opportunity. “Unlike the previous ‘going overseas’, NIO hopes to become a truly global company based in China. This requires globalization in R&D, management and marketing.” The reporter learned from NIO that the current local employees It accounts for 90% of NIO employees in Europe. NIO is entering the European market with a system-wide approach, bringing their online and offline model of building user communities to Europe.
Wang Qinghua told reporters that the main reason for the success of China’s new energy vehicles is the application of customer-centric products and marketing strategies. No matter in product design, intelligent function configuration, or service system, they have grasped customer needs and provided solutions. Program. For overseas markets, how to continue to maintain these success factors to deal with completely different markets is something that every overseas company should seriously deal with. Saboni, deputy director of S&P Global Auto China’s automotive enterprise planning service, told the Global Times reporter that Europe is a region composed of more than 30 countries. Chinese brands need to be patient in understanding the differences in the markets of various countries and carry out targeted strategic planning. . Efahrer, a German automobile professional website, takes the Aiways brand, which entered the European market earlier, and believes that Aiways’ new products to be launched in Europe have been improved according to the needs of Europeans. For example, when the tailgate is opened, even if it is 1.85 meters tall, it can be Stand under the tailgate. Fu Yuwu believes that, especially when new Chinese brands come to Europe, they face not only capital issues, but also issues of brand, quality and reliability, service methods, and harsh European standards, all of which are huge challenges.
Get ready for the challenge
The entry of Chinese brand cars into the European market has also attracted the attention of the Indian media. India’s “Economic Times” reported that a European consumer said that Chinese automakers understand that they currently lack consumer brand recognition in the local market, lack of retail stores and auto parts networks. The report believes that the European market is now in a period of high economic instability, energy crisis and high inflation, which gives Chinese companies a market learning opportunity.
Management consulting firm Strategy& Research predicts that Chinese brands will have a market share of 7.9% in the European electric vehicle market in 2030. Brands such as BYD and NIO will soon be part of European street vehicles. But the report also argues that the start of Chinese electric vehicles in Europe may have some problems, such as difficult customer acceptance, EU import restrictions and boycotts by local manufacturers.
Fu Yuwu told reporters that it is not yet possible to talk about China becoming a powerhouse in the automobile industry, because the automobile industry cannot be separated from the entire manufacturing industry, and China still has the problem of “stuck neck” in the fields of high-end manufacturing, high-end equipment, especially semiconductor chips. “At this time, China’s auto industry must be rational and see the gap with industrial powers before it can find the next breakthrough.” He believes that the current achievements are mainly due to the market mechanism and the dominant position of enterprises in recent years’ industrial development. play a key role in. As for the standard requirements of “carbon neutrality” in different markets around the world, Fu Yuwu also said that China’s auto industry is well prepared, although some companies in the supply chain have to start over.
The globalization of Chinese auto brands has brought a new atmosphere to the global auto industry and new opportunities for companies from all over the industry chain. Saboni said that some Chinese new energy vehicle models have become important benchmarks for the development of models by global car companies. Relevant personnel of Continental Group told the Global Times reporter that Continental Group firmly supports Chinese local brands to go overseas to the global market, and the Group can use global collaboration to provide systematic solutions for Chinese brands.
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