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A brand that has been scolded miserably in China, but its global sales have reached a new high?

A brand that has been scolded miserably in China, but its global sales have reached a new high?

A brand that has been scolded miserably in China, but its global sales have reached a new high?

Is the Chinese market not as important as we think?

Written by Leung Chi Ho

"Changing the shell of Toyota", "Highway Lightning", "Price for volume"...... In 2023, Lexus, which was once infinitely beautiful, can be said to have fallen to an unprecedented trough on the Internet.

But the diametrically opposed to this criticism is its sales.

A brand that has been scolded miserably in China, but its global sales have reached a new high?

During the Lunar New Year, Lexus officially announced the brand's global sales data for 2023, which is different from the speculation of some netizens that "as soon as this year, at the latest next year (bankruptcy)", Lexus's sales from January to December 2023 increased by 32%, with total sales reaching 824258 units, and setting a new record for the brand.

A brand that has been scolded miserably in China, but its global sales have reached a new high?

Among them, the North American market continues to be a well-deserved "home base" of Lexus, with sales of more than 350,000 units up 24% year-on-year. Sales in Japan's home market have surged by 129%, from 41,253 units in 2022 to 94,647 units.

A brand that has been scolded miserably in China, but its global sales have reached a new high?

However, it is worth noting that although Lexus has achieved sales growth in all segments of the world in 2023, the Chinese market, which is the second largest market for the brand, has a 3% growth rate that is significantly behind other regions. You must know that in 2022, the Lexus brand will have its first sales decline in the Chinese market, and the decline will be as high as 22%, which means that this wave of sales in 2023 is still not enough for Lexus to recover in the Chinese market.

A brand that has been scolded miserably in China, but its global sales have reached a new high?

In other words, the popularity of Lexus in the Chinese market is indeed as consistent with its public opinion, showing a downward trend. In order to maintain sales, this brand, which used to sell cars with arrogance, has successively begun to raise prices in the terminal market since last year.

A brand that has been scolded miserably in China, but its global sales have reached a new high?

As the executive sedan ES series of Lexus sales, the discount margin of the ES200 model has been able to achieve more than 40,000 yuan, and the landing price has been lower than the guide price, and if it is a more unpopular ES260 model, the discount margin is even more amazing.

A brand that has been scolded miserably in China, but its global sales have reached a new high?

If the price of the ES series is "lost" and its approaching replacement has a certain relationship, then as a new car that will only be launched in 2023, the RX series, which had a "full life cycle price increase" before the replacement, has also begun to have terminal discounts, which reflects a relatively big problem.

A brand that has been scolded miserably in China, but its global sales have reached a new high?

At present, the RX series of 350h models full car purchase discount range is about 20,000-30,000 yuan level, loan concessions even to more than 50,000 yuan, as a new car that has been on the market for only one year, this preferential range is indeed too Lexus, after all, the previous generation of RX even if it is sold until the moment before the production of production still has to increase the price of the car.

A brand that has been scolded miserably in China, but its global sales have reached a new high?

In fact, except for the LM, a model with its own social attributes and identity labels, and the GX, which has just been launched, the entire Lexus brand has basically lost its chance to "increase the price". However, apart from the regular operation of exchanging price for volume, Lexus does not seem to show too much concern about their weakening in the Chinese market.

They seem to be operating step by step in the field of new energy, and they have no plans to promote localization, and compared with their considerable profit margins in previous years, the current terminal discounts are just a "drop in the bucket".

A brand that has been scolded miserably in China, but its global sales have reached a new high?

This unhurried attitude is indeed not the proper attitude of a mature car brand towards its second largest market. However, judging from the current sales distribution of Lexus and the background of the establishment of this brand, the Chinese market has never been their main target, and the North American market is the real home of Lexus.

A brand that has been scolded miserably in China, but its global sales have reached a new high?

Most obviously, Lexus offers the widest selection of product lines in the North American market, and even has special models such as the TX series and IS500. After all, Lexus's success in the U.S. market is tied to the success of the U.S. market. It's just that the sub-design aesthetics revealed in their products and the reputation they have accumulated before coincide with the preferences of Chinese consumers, so they can unexpectedly kill all sides in this market.

A brand that has been scolded miserably in China, but its global sales have reached a new high?

And with the rise of Chinese automobiles, the consumption habits of our market have begun to diverge from those of North America, which means that Lexus may no longer be able to eat such a piece of fat delivered to the mouth in the future. Whether from a market perspective, or deeper historical ties or even geopolitical considerations, when Lexus is forced to choose between the U.S. market and the Chinese market, the former is undoubtedly their first choice.

A brand that has been scolded miserably in China, but its global sales have reached a new high?

This actually explains why Lexus would rather launch a small SUV like the LBX for the European market, which is half-dead and has suppressed Japanese cars in various ways, rather than provide more tailor-made products for the Chinese market.

"Don't give up easily, but never take it seriously"

THIS STRATEGY FOR THE CHINESE MARKET IS ACTUALLY NOT LIMITED TO LEXUS, AND LEXUS ANNOUNCED ITS 2023 RESULTS AT THE SAME TIME AS STELLENTIS GROUP, BECAUSE THIS GROUP MERGED BY PSA AND FCA, IT HAS GATHERED MANY BRANDS THAT CANNOT SUCCEED IN THE CHINESE MARKET, SO IT HAS ALSO BEEN RIDICULED BY MANY CHINESE NETIZENS AS A "LOSER ALLIANCE".

A brand that has been scolded miserably in China, but its global sales have reached a new high?

However, such a brand, which has little to do with the Chinese market, has achieved record-breaking results in 2023 - its net revenue, net profit, and industrial free cash flow have all reached the highest level in history, while the sales of pure electric models have also increased significantly, and like Lexus, its performance in the China (Asia-Pacific) region has also not been excellent, and even declined.

A brand that has been scolded miserably in China, but its global sales have reached a new high?
A brand that has been scolded miserably in China, but its global sales have reached a new high?
A brand that has been scolded miserably in China, but its global sales have reached a new high?

IN FACT, AFTER JEEP WITHDREW FROM THE CHINESE MARKET, EXCEPT FOR PEUGEOT, CITROEN, AND IMPORTED MASERATI AND ALFA ROMEO, THE BIGGEST INTEREST OF THE ENTIRE STELLENTIS GROUP IN THE CHINESE MARKET WAS ONLY THE "MEDIOLY" 1.5 BILLION EUROS INVESTMENT COOPERATION BETWEEN THEM AND LEAPMOTOR. ALTHOUGH PEUGEOT CITROEN HAS PREVIOUSLY INSISTED THAT IT WILL NOT WITHDRAW FROM THE CHINESE MARKET, ANYONE WITH A DISCERNING EYE CAN SEE THAT STELLENTIS GROUP WILL NEVER INVEST TOO MANY RESOURCES IN COOPERATION WITH DONGFENG GROUP.

A brand that has been scolded miserably in China, but its global sales have reached a new high?

Similarly, the Hyundai-Kia Group, which has repeatedly hit a wall in the Chinese market and even repeatedly spread negative news such as insolvency and the sale of factories, will also hit a new high in profits in 2023, and will firmly occupy the throne of the world's third largest automobile group with cumulative sales of 7.3 million units, second only to Toyota and Volkswagen Group, of which the Hyundai brand sold 4.216 million units, while the Kia brand sold 3.086 million units, but the Chinese market only contributed 244,000 units and 80,000 units to the sales of these two brands.

A brand that has been scolded miserably in China, but its global sales have reached a new high?

China's auto market, which has strong domestic demand, has always given us the illusion that all brands must succeed in this market in order to survive. But in fact, no, even in the absence of the Chinese market, these overseas brands can still live well.

The reason why I say this is not to deny the efforts of our Chinese brands, let alone to shout for foreign brands, what I want to express is that at a time when Chinese cars are still subject to various restrictions on going overseas, even if our own brands "drive away" all overseas brands, our market volume and digestion capacity are still quite limited, it is not enough to support the sustainable and healthy development of our automobile industry, and it is impossible for Chinese car brands to stand on the top of the world.

A brand that has been scolded miserably in China, but its global sales have reached a new high?

If we want to truly achieve the goal of leading the world automobile market, we can only use the current wave of electrification + intelligence to widen the gap between us and overseas brands as much as possible, and to affect the transformation of the automobile consumption pattern, so that foreigners have to choose Chinese brand cars because of lower prices and better experience, and put aside the stereotypes of Chinese manufacturing.

Maybe you are full of confusion about electrification, and even angry about the various "refrigerators and color TVs" of your own brands, but this may be a rare opportunity for us to turn over in a century.

Today's topic

Are you optimistic about the future of Chinese automobiles?

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