BYD and other Chinese car companies were forced to abandon the US market, but there was one exception!
Livestock Corps 2024
2024-04-10 19:22Posted in Guangdong financial field creators
According to foreign media reports, BYD and other Chinese car companies may abandon the US market. Truth be told, it's a helpless choice. The U.S. is the world's second-largest auto market, and there is no car company that doesn't want to enter the U.S.
South Korea's Hyundai's sales in China have fallen to 257,000 units, and Kia's sales have fallen to 166,000 units. In China, Korean cars are becoming more and more marginalized. However, in the global market, Hyundai-Kia Group ranks third in the world with sales of more than 7 million units.
Among them, the largest contribution is the US market. In 2023, Hyundai sold 1.65 million units in the U.S., and Kia Motors also sold 780,000 units in the U.S., totaling more than 2.43 million units. Since the United States is the only superpower in the world, occupying the U.S. market means occupying the commanding heights of the global auto market. As long as the U.S. market is opened, it can drive global sales.
However, both Biden and Trump intend to severely restrict the export of Chinese cars to the United States. Biden wants to strictly review China's new energy vehicle imports, even parts imports. Mr. Trump has reverted to the trade war, announcing a 100 percent tariff on Chinese cars. Even if Chinese car companies go to Mexico to build factories, they can't export to the United States. According to Trump, if Chinese automakers want to break into the U.S. market, they must build factories in the United States.
However, Huawei's case has made Chinese car companies dare not build factories in the United States. The reason is simple, Huawei has really set up an office in the United States, deeply cultivated the rural market in the United States, and recruited 2,000 American employees. But as a result, Meng Wanzhou was swept away, and Meng Wanzhou was detained by Canada for 1,028 days. ByteDance, another Chinese company that has entered the U.S. market, has also been forced by the U.S. Congress to intervene. Its Tiktok has become the most popular short video social media in the United States, but Biden directly played the card: "We don't want to ban Tiktok, we want to take it down." ”
Chinese companies are in the United States, they are doing too badly, they can't make money, and they will lose money. If it is done too well, it will immediately be targeted by the US government, ranging from forced mergers and acquisitions to the acquisition of American capital, global blockade and detention of Chinese executives. It is really difficult for Chinese companies to operate in the United States with this kind of rogue government. When it comes to the business environment of Chinese companies overseas, India is the worst in the first place, and the United States is the worst in the second.
Originally, BYD planned to enter the United States. After all, Tesla's home base is in the United States. If BYD can enter the U.S. market and fight Tesla head-on, then BYD's brand reputation will inevitably go to a higher level, and it will be able to gain global popularity and enter the global market faster. However, in the face of this situation, BYD went to the United States, wouldn't it become meat on the chopping board? One way is not passable, so we want to go to Mexico to build a factory and export it to the United States. But now, the road has also been blocked.
No one wants to give up the U.S. market, but Chinese car companies have no choice but to avoid the U.S. temporarily, including BYD, Great Wall, Chery, etc., all dare not go to the United States to build factories. In the face of the big fat meat of the American market, we can only endure it first. However, the west is not bright and the east is bright, North America cannot be sold, and Latin America is in the south.
Chinese automobiles have become an important import category for many Latin American countries such as Mexico, Brazil, Argentina and Chile. Chery and BYD are both building factories in Brazil, Chery has also built factories in Mexico, and plans to invest $400 million in Argentina to set up a new plant. Among them, Chery has become the largest car brand in Chile. Because Chile implements zero tariffs on Chinese car imports, Chery does not need to build a separate factory in Chile.
But in the midst of the draconian blockade imposed by the U.S. government, three exceptions were born. So far, there are three main Chinese car companies that have entered the U.S. market. One is SAIC, the second is Changan Group, and the third is Geely Holdings.
SAIC and Changan mainly rely on OEM production and export to the United States. SAIC and GM will produce Buick and Cadillac vehicles for export to the United States. Changan and Ford will produce Focus cars for export to the United States. The Focus is no longer produced in the United States, and all of them are produced by Changan, China. Geely is the most special, as it acquired Volvo and founded Polestar with Volvo. This allows Geely to achieve "curve into the United States" and enter the American market.
In 2023, Volvo's total global sales will be 708,700 units, of which 128,700 will be sold in the US market. Considering that Volvo is a high-end brand, it brings in revenue equivalent to Geely selling 400,000 vehicles. In addition, Polestar cars did not sell well in China, but sold 54,600 units overseas, most of which went to Europe.
Volvo, as a Nordic brand acquired by a Chinese company, is the only Chinese car that has not been suppressed by the United States. So far, the United States has mainly targeted Chinese independent brands going overseas, such as BYD, Great Wall, Geely, Changan and Chery, etc., and China's new car-making forces cannot enter the US market for the time being. SAIC and Changan's OEM export model is originally for American car companies.
The only one who really sells his car to the United States and makes money, without sanctions or suppression, is only Geely's Volvo Cars.