Sea! Sell your car to someone else's turf!

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In 2005, at the Frankfurt Motor Show in Germany, the Peking Opera actors at the Geely Automobile booth attracted special attention.

For the first time, a Chinese brand has appeared here. It is said that Geely spent 10 million yuan for this appearance, attracting GM CEO Wagner and other executives to stop and watch, and also let Chinese car companies earn enough global attention.

The Chinese brand of that year was still very weak, which can be seen from the models unveiled by Geely Automobile - the right-hand drive export car of the Haoqing 203A, the geely second-generation sports car "China Dragon", the "Freedom Ship" equipped with China's first automatic transmission...

The Auspicious Chinese Dragon is a brave exploration

People who are familiar with Chinese brand cars can smell the punk flavor of the barbaric growth of Chinese brands in those years from this ancient name.

Geely, which participated in the Frankfurt Motor Show, saw an immediate impact, exporting 4,846 cars in 2004 and nearly 7,000 cars in 2005. Since then, more and more Chinese car companies have participated in the Frankfurt Motor Show. Chery, Brilliance, Hongqi, Chang'an, and the Great Wall all competed to appear at exotic international auto shows.

The auto show may be a symbolic symbol, representing the beginning of the Chinese brand's going to sea. In China, in 2005, Ashkenazi, Japanese, French, and American were still god-like beings, and the joint venture brand was still a status symbol in China.

If anyone has a joint venture brand car, it often means that the person is standing at the "tip of the pyramid" of life at that time.

Of course, the Chinese brands in those years still refer to the cars of Brilliance China Zunchi, Chery A5, and Hafei Sai leopard. At that time, internationally renowned executives still looked down on Chinese cars, and Intel President Andy Grove once criticized: "Chinese multinational companies are always in the minority, because the development of Chinese companies has strategic short-sightedness." ”

Relying on the primitive accumulation step by step, after more than a decade, Chinese brands have silently sold cars to the hometowns of these executives.

#壹

Overseas sales have soared, and Chinese brands are going global

Once upon a time, going to sea was only part of the move of a few car companies.

For China's own brand car companies, the beginning of overseas expeditions can be traced back to 1957. At that time, 3 Jiefang brand trucks drove out of the country, achieving a "breakthrough of zero" in automobile exports. Today, China's own brand car companies have gone through a 64-year history of going overseas.

The "new year" of Chinese car companies going to sea dates back to 2017. In this year, the domestic auto market showed a negative growth trend, and car companies began to look for a second curve.

At that time, there were no very advantageous overseas enterprises in China, and everyone stood on the same starting line, which was undoubtedly a good point of strength. Subsequently, a number of independent car companies announced the formulation of globalization strategies.

For example, the above-mentioned Auto-GM-Wuling, before 2017, it landed its overseas strategy in the Southeast Asian market. In 2017, SAIC-GM-Wuling spent 700 million US dollars to set up an Indonesian subsidiary and forcibly broke into the Indonesian automobile consumer market, which is monopolized by Japanese brands and is still in its infancy.

Baojun 530 with Chevrolet logo

Overseas, SAIC-GM-Wuling also used the "re-labeling" tactic to open up markets in different countries by using different car logos. In South America, for example, the Baojun 530 uses Chevrolet's logo.

Chery, on the other hand, chose to enter into a strategic cooperation with CAOA Group, Brazil's largest automobile manufacturer and seller.

The Great Wall built a factory in Russia, Geely acquired Proton, and the new car-making forces extended their tentacles to distant Norway when they had not yet fully established themselves in The country.

Going to sea has become the most fashionable word at the moment. For car companies, no matter which way they choose, no matter which market they choose, going to sea is a step that must be taken. This is the coming-of-age ceremony of the new car-making forces, and it is also a new challenge for those traditional car companies that have been fighting in China for many years.

Former FCA CEO Marchionne once predicted that there will be only six global car companies left in the future. Li Shufu, chairman of Geely Automobile, has also predicted that only two or three traditional car companies in the world will survive in the future, and Wei Jianjun shouted: "Globalization is the only way out for Chinese auto companies." ”

After the advent of 2021, Chinese brands have received an unforgettable memory when they go to sea.

"Explosive growth" in 2021

According to the China Automobile Association, in 2021, China's automobile exports reached 2.015 million units, an increase of 1 times year-on-year, accounting for 7.7% of total automobile sales, an increase of 3.7 percentage points over the previous year. Doubling is not an easy task. For many years, China's auto exports have long hovered around 1 million vehicles.

In 2021, with the doubling of the total amount, many car companies have also harvested new milestones in going to sea. SAIC motor sold 697,000 units in overseas markets, setting a new record with a year-on-year growth rate of 78.9%, and Chery Automobile exported 269,000 units, a record high.

In 2021, passenger car exports increased by 1.1 times, and among these export vehicles, SUVs occupy an absolute dominant position, which is also a performance of Chinese brand SUVs to further enhance their competitiveness.

In addition, in the field of commercial vehicles, buses and trucks have shown rapid growth. In 2021, BYD cooperated with Keihan Bus and Kansai Electric Power to jointly build Japan's first pure electric bus ring line. At present, BYD's pure electric bus market share in Japan has reached 70%.

Multi-point blossoming, explosive growth, these words are particularly apt to describe the chinese brand's going to sea. Xu Haidong, deputy chief engineer of the China Association of Automobile Manufacturers, said that there are some accidental factors behind China's good auto exports in 2021, but more importantly, the growth of the hard power of Chinese brand cars has played a supporting role.

If it is said that Chinese brands in the past few years have also exported a large number of cars to developing countries and regions such as Asia, Africa and Latin America, then the current Chinese brands can already compete with traditional car companies with a century-old history in developed automobile markets such as Europe and the United States.

When the new energy track came, Chinese brands seized the opportunity and fought a beautiful turnaround battle.

#贰

From Asia, Africa and Latin America to Europe and the United States

From traditional fuel oil to new energy

Once upon a time, it was "everyday" for Chinese brands to fold in the European and American markets.

In 2007, this year was a heavy blow to the export of Chinese brands. Brilliance's first car, the BS6, launched to Europe, achieved an embarrassing score of only 1 star in the German ADC crash test, triggering the widely watched "collision gate incident".

This star hits the face of the Chinese brand

Although BS6 received a 3-star rating in the European NCAP test conducted since then, the "collision gate" still had a great impact on Brilliance exports, and more importantly, this distrust was transmitted through Brilliance to the entire Chinese brand.

In addition, the European and American markets in that year required higher emission standards than domestic standards, which was also a major challenge for most independent brands. When Europe has begun to implement the new Euro 5 standard, and many Chinese brands can only export models to meet the Euro 4 standard, they have to wait until the standard is met before they can resume exports.

But with the advent of the new track of new energy, Chinese brands have seized the opportunity to change the face of the past in one fell swoop.

Judging from the export of new energy vehicles in the past two years, new energy vehicles are the core growth point of China's automobile exports. In 2020, China exported 223,000 new energy vehicles, and in 2021, it exported 588,000 new energy vehicles, showing a continuous strengthening trend. According to the latest data, from January to March 2022, 200,000 new energy vehicles were exported in only one quarter.

More importantly, China's new energy vehicles are mainly exported to Western Europe and Southeast Asia. Among them, countries such as Belgium and the United Kingdom have become export highlights, which has changed the situation of car exports that rely on Asia, Africa and Latin America. Driven by the export of new energy vehicles, the export of Chinese brands of automobiles has also launched an impact on the "developed market" again and again.

Customs data show that in 2021, the top ten countries in China's new energy vehicle export volume are Belgium, Bangladesh, the United Kingdom, India, Thailand, Germany, France, Slovenia, Australia and the Philippines.

In 2021, China's auto exports to Europe are the fastest growing, reaching a growth rate of 204%, and exports to North America are also growing by more than 100%. At the same time, China has also achieved good results in the more economically developed regions of all continents. In Asia, for example, China's auto exports to Thailand grew by 793%.

While conquering developed markets, China no longer relies on low prices to win.

Customs data show that in the first three quarters of 2021, the export value of pure electric passenger cars reached 5.498 billion US dollars, an increase of 515.4% year-on-year, and the growth of export value was greater than the growth of export quantity, which intuitively reflected that the export price of China's new energy vehicle products was greatly improved. Xu Haidong said that the average price of Chinese brand new energy vehicles in the European market reached 30,000 US dollars / unit.

Li Xuan, a senior analyst in the technology industry of Haitong Securities, said that the reason why the European market can drive the export of new energy vehicles in the mainland is that the European new energy vehicle market is still booming, and the transformation of traditional European and American car brands in the new energy vehicle market is difficult, which gives foreign brands the opportunity to enter the European new energy vehicle market.

Looking to the future, the export of Chinese brands is still promising.

From the product point of view, new energy vehicles belong to the category of new products, for foreign consumers, foreign traditional automobile companies in the development of new energy vehicles are relatively slow, and Chinese car companies after the fierce domestic battlefield "baptism", product creation and cost advantages have reached a new level, so they have strong competitiveness.

NIO is selling its cars to Norway

From the perspective of international trends, in order to achieve the goal of carbon reduction, in recent years, many European governments have increased subsidies for new energy vehicles, activating the European new energy vehicle market, and China's new energy vehicle products have been recognized by European consumers.

However, on the long journey to sea, compared with the road traveled by established multinational car companies, Chinese brands have just started, and the challenges and risks they face still exist.

#叁

The challenges remain, but the opportunities remain undiminished

In 2015, Great Wall Motors fought a lawsuit in Russia. The reason is that since October 2014, the Russian dealer Ilito Group has not been able to pay for the car on time, involving an amount of US$48.44 million (about 332 million yuan).

As a result, Great Wall Motors filed a lawsuit in October 2015, demanding that IMS Co., Ltd., a subsidiary of The Yilito Group, pay the amount due. And these accounts are directly counted in the "bad debts" of Great Wall Motors' financial reports that year.

This is the wave encountered by Chinese car companies going to sea. Changes in overseas markets have also brought new challenges to Chinese car companies.

The relevant person in charge of a car company said that the overseas development of Chinese brands has brought challenges in various aspects such as capital, technology, management and cultural integration. How to respect local customs, how to open up the connection between production, supply and marketing, and how to find out the local product demand as soon as possible are all problems that have to be considered.

The establishment of overseas factories and the implementation of localization strategies are becoming the common choice of Chinese car companies.

Great Wall Russian Tula plant

Compared with exports, the direct construction of factories overseas not only avoids the high tax rate of vehicle exports, but also some countries will give policy support in order to attract investment. For example, Ghana, located in Africa, has proposed a decade-long tax incentive to attract internationally renowned car companies to build factories.

"Only by having their own overseas factories can the development of Chinese brand automobile companies overseas be sustainable." Xu Haidong said that the direct investment model can not only drive local employment, but also help to improve the recognition of local consumers' brand culture, thereby increasing overseas sales, which will be the future development direction of Chinese brand cars "going out".

Up to now, Geely has a total of 7 overseas factories in Belarus, the United Kingdom, Egypt, Uruguay and Indonesia. The number of Chery's overseas factories has grown to 17.

Gili Boyue appeared at the scene of the Russian-Ukrainian negotiations

Xu Haidong said that the overseas of Chinese brands must achieve an "output system" in the future. "The system includes from the beginning of the information policy collection, to the logistics and transportation, financial insurance and used cars, service systems, etc., and finally also includes our overseas factories and overseas employees."

Further into the European and American markets, There are still certain challenges for Chinese auto brands. For example, Europe and the United States have strict technical and environmental protection standards for new energy vehicles, and some brands are more difficult to obtain access licenses; secondly, Europe and the United States have strict import controls on automobile batteries. Yang Chengyu, an associate researcher at the Institute of European Studies of the Chinese Academy of Social Sciences, said, "If the mainland new energy vehicle independent brands want to break the export shackles, the most effective way is to carry out production capacity cooperation. ”

Envision Technology established a super battery factory in France, and the German factory in the Ningde era began mass production of batteries. "Compared with the previous large-scale acquisitions in Europe, this method is conducive to deeper embedding in the industrial chain and is conducive to the complementary advantages of China and Europe." He said.

In 2022, China's auto exports may continue to grow. Cui Dongshu, secretary general of the Association of Automobile Manufacturers, said that China's automobile production is relatively strong, and the export performance in the early stage is more prominent, while Europe is still in a situation of lack of cars due to lack of cores and poor operation. "In this case, the export of Chinese cars is a positive factor."

At the same time, Cui Dongshu added that there is still a gap in the quality and service of Chinese brands going to sea, especially the quality of traditional fuel vehicles. Due to the popularity of electrification in Asia, it may become the next growth point for Chinese cars to go overseas.

With the establishment of overseas factories by Chinese car companies, hiring and managing overseas employees, passing on brand values, and adapting to local culture are also difficult problems that Chinese car companies need to face in the future overseas development.

But the indisputable fact is that the Chinese brand has embarked on a "sustainable development" road. In time, we may see Chinese brand cars in all corners of the world.