Some time ago, many domestic car companies cut prices, and BYD big brother turned the table as we all know, and later many car companies have joined this new energy war, recently foreign media reported that many Chinese car companies are going to give up the news of the American market, is it because it is involved in grandma's house or not enough?
In this big chess game in the global auto market, Chinese car companies are constantly seeking new growth space and market opportunities, especially in Latin America, some "small tricks" have attracted media attention. In the face of difficulties and challenges, it seems wiser to choose a market that is easier to enter and has the potential to grow. However, abandoning the high-risk U.S. market and turning to the Latin American market is really a broader path for Chinese automakers.
The Northern Expedition begins
The "Northern Expedition" of Chinese car companies around the world has never stopped, and although the US market has high tariffs and strict policy environment, this has not completely stopped our Chinese car companies from pursuing overseas. Looking at Latin America, where market share is unique and Latin American consumers are more price-sensitive, this provides a place for price-competitive Chinese models.
From 2020 to 2023, the share of our "domestic small steel cannons" in the Mexican market increased from 1% to 10%. Such a big improvement is not only due to the strategic adjustment of Chinese car companies, but also due to the gradual acceptance of their "domestic small steel cannons" by the local market. For example, SAIC and Chery have quickly gained market share by offering competitive prices and continuously improving vehicle quality. This rapid development has been achieved against the backdrop of the global automotive supply chain facing the impact of the epidemic and supply shortages, reflecting the strong adaptability and rapid response mechanism of Chinese automakers.
In Brazil, the performance of Chinese car companies is also eye-catching. BYD,
Several models from Chery and Great Wall Motor have successfully entered the list of the top 10 best-selling pure electric and plug-in hybrid models in the local market. BYD, in particular, has become the new favorite of the Brazilian electric vehicle market with its models such as the Dolphin Mini, Atto 3 and Song Plus DM-i, which have become the new darlings of the Brazilian electric vehicle market due to their affordable prices and good performance. From 18,800 units in 2022 to more than 52,000 units in 2023, this growth rate proves that its products are a perfect match with market demand.
In addition, most of the models launched by the domestic "Northern Expedition" in the Latin American market are cost-effective models, which are highly consistent with the needs of the local market. Compact models account for more than 60% of the light vehicle market in Brazil and Mexico, much higher than the 30%-40% share in North America. This difference allows Chinese automakers to better position their products to the needs of local consumers, thus gaining an edge over the competition.
With the "Northern Expedition" of the domestic car market, Chinese car companies have also established a number of production bases in the local area. This helps to reduce production costs and is also an effective way to circumvent import tariffs and other potential trade barriers. Chery already has two plants in Brazil, and Great Wall Motor's plant is scheduled to start production between 2024 and 2025. The establishment of these factories provides a more efficient supply chain and faster market response for the local market, ensuring the long-term competitiveness of "domestic small steel cannons" in the Latin American market.
Drumming! march
In terms of the strategy of domestic vehicles to enter the market, Chinese automakers are not only focusing on the promotion of electric and hybrid vehicles, but also actively exploring other automotive technologies, such as autonomous driving and connected cars, which are important development directions for the future automotive industry. Through this diversified market strategy, Chinese automakers have not only gained a firm foothold in the Latin American market, but also gradually formed the international influence of their brands.
However, the success of Chinese automakers lies not only in the choice of the market and the adaptation of products, but also in their continuous technological innovation and improvement. These companies know that only by continuously improving product quality and technical content can they maintain an advantage in global competition. Therefore, whether it is in battery technology, motor efficiency, or in the intelligence and networking of vehicles, Chinese car companies are constantly pushing the boundaries of technology.
In addition, the success of Chinese automakers in the Latin American market also provides an important reference for the market strategies of other countries. By observing the performance of Chinese brands in Latin America, automakers in other countries can better understand the needs and challenges of emerging markets, so that they can adjust their marketing strategies to adapt to the changing global market.
The success of this strategy has also brought new enlightenment to the global automotive industry, in which the diversity and complexity of the market require companies to have the ability to flexibly adjust their strategies. Only those companies that can quickly adjust their strategies and implement effective execution according to the specific conditions and needs of different markets can stand out in the fierce international competition.
In general, the Latin American strategy of Chinese automakers is not only a matter of market selection, but also a strategic decision on how to move forward steadily in the wave of globalization. The success of this strategy demonstrates the importance of market sensitivity, rapid response and technological innovation of Chinese automakers. The right time, the right place, the right people and the understanding and grasp of the market dynamics are the key to winning the competition.
Finally, what do you think of domestic car companies?