U.S. brand car sales in China are less than half: where do U.S. automakers lose?
The Eastern Regions
2024-05-11 22:08Posted in Beijing Knowledge Officer Former Air Force Lieutenant Colonel Officer
CNBC reports that U.S. automakers and their Chinese counterparts are fighting an existential battle for the market, as Chinese automakers are innovating faster than they can compete in the domestic auto market.
Driven by government investment and subsidy policies, local Chinese companies stand out from the competition in the field of electric vehicle technology and intelligent driving system software. Since peaking in market share a few years ago, U.S. automakers have seen a significant decline in sales in China.
Michael Dunn of Dunne Insights said: "I don't want it to sound too dramatic. "Dunn has been studying the automotive market in China and other Asian countries for nearly 30 years." I just want to realistically say that in the next five years, Ford, GM, Hyundai, Kia, Nissan are all likely to withdraw from China. They just stop competing with the Chinese. ”
GM's sales in China, including those of its joint ventures in China, have fallen from a high of 4 million units in 2017 to 2.1 million units in 2023. This is the first time since 2009 that it has sold less than the 2.59 million units sold in the U.S. market.
GM's stock price is down 34% this year due to its performance in revenue in the second-largest market.
Several factors have contributed to the decline of American automakers in the Chinese market. This includes that local Chinese automakers have learned a lot from foreign automakers, and a long time ago a law required foreign automakers to partner with local companies in order to operate in the region. Later, a number of successful Chinese companies reversely acquired foreign brands, including British brands MG and Lotus, as well as Sweden's Volvo.
There has also been a surge in outside investment from China-based companies – including BYD, in which Berkshire Hathaway holds a stake.
The Chinese market has changed dramatically over the past decade. The concept of a car as a scrolling computer or smartphone became a reality in China. In fact, new entrants include mobile phone makers Xiaomi and Huawei.
According to Bill Russell, a former Chrysler executive at Automobility, a Shanghai-based consulting firm, that's exactly why U.S. automakers shouldn't abandon China, despite the setbacks in U.S. companies' sales in China. He said these shifts over the past few years will continue.
If you're not competing in the fierce competition in China, what do you do when a Chinese brand shows up in your backyard? Bill Russell said. "How do you know how to compete with them? You haven't even tried. “
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U.S. brand car sales in China are less than half: where do U.S. automakers lose? -
U.S. brand car sales in China are less than half: where do U.S. automakers lose? -
U.S. brand car sales in China are less than half: where do U.S. automakers lose?
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