Are Chinese cars taking over the world?
Great Wall has become the first Chinese manufacturer to have passed European Union standards and set up shop in Europe. Its Voleex models (above) have even reached the Holy Grail of the British market. If you’re of a certain age and into cars, you’ve probably heard the one about the Lada. Or possibly the Trabant. The Yugo was a favourite target of the budding comedian. “Yugo, but it doesn’t,” was a popular zinger back in the day.
Chinese cars could have ended up like those Eastern Bloc lemons -- not worth the gas filling their tanks. But the latest joke going into Auto Shanghai 2011, the country’s biggest motor show, is the one about Chinese carmakers laughing all the way to the bank.
Buying domestic
Honestly, they’re going to have a fairly good international presence, but by virtue of the Chinese auto market being so important, we’ve seen foreign makers -- like Buick, for example -- become more competitive.— Ben Cavender, China Market Research Group
Chinese cars are the latest home-spun offerings to woo back citizens from the chrome lure of BMW, Mercedes and Honda. According to vehicle registrations, the top two sellers for January 2011 are BYD’s F3 and Tianjin’s finest: the FAW Xiali.
In the SUV category, the C3 by Great Wall, the first private domestic automaker to go public, is the number-two seller (behind Honda’s CRV), shipping 10,000 in February alone.
Dong Yang, secretary general of the China Association of Automobile Manufacturers, says China has become the largest automobile production and marketing country in the world.
“The dominance of foreign automobiles in Chinese market has been brought to an end,” he announced to China Daily in November.
Auto Shanghai 2011 will highlight some of the sexier Sino models due to chew up local roads. Nothing says “Please take us seriously” more longingly than FAW’s shocking new electric-car joint venture with Toyota, for example.
Meanwhile, around the world, all roads are leading to China.
“Sales of Chinese automobiles are 20 percent of the world market,” says Dong. International sales are destined to continue to push that number upward.
Chinese cars go abroad, no visas needed
Australia, with its established Chinese population, has been an obvious target for China’s top brands. Geely, the one-time refrigerator-manufacturer, launched its MK light sedan and LC Panda hatchback in Australia earlier this year.
And last month Chery’s J1 hatchback debuted Down Under amid a lot of talk it would be the new Kia. The big draw for Aussies? The price tag: at just over US$12,000, the J1 undercuts every other compact SUV on the market.
In fact, Chery shipped nearly 100,000 vehicles overseas last year, equivalent to 13.5 percent of its overall sales. Most of those cars went to developing nations in Asia, Latin America and the Middle East.
The dominance of foreign automobiles in Chinese market has been brought to an end.— Dong Yang, secretary general of the China Association of Automobile Manufacturers
In India’s booming truck market, Shanghai’s SAIC Motor and Beiqi Foton Motor Co. have become major players. In fact, Foton -- a subsidiary of Beijing Automobile Group Co -- is the world’s second largest commercial vehicle manufacturer after Daimler. The company sold 682,800 trucks in 2010.
Great Wall, a great “admirer” of best-selling Italian and Japanese models, has tasted success in Australia with its X240 SUV. And now it has become the first Chinese manufacturer to have passed European Union standards and set up shop in Europe. Its Voleex models have even reached the Holy Grail of the British market.
“These brands are serious, and serious about having a strong international presence,” says Ben Cavender, who oversees the automobile sector for the China Market Research Group. Cavender points to the huge potential of companies like Geely -- which purchased Volvo a year ago for US$1.8 billion -- with capital to spare.
Geely will steal some of Volvo’s cachet to address its biggest liability (at least in the eyes the United States and Britain, the world’s most mature markets): safety.
“These companies have lots of cash and are willing to make acquisitions,” says Cavender, name checking another Sino-European entity.
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“Roewe is basically the result of Chinese brand [SAIC] purchasing all of the tooling machinery from Rover.”
Shanghai-based Roewe ended 2010 with a 77 percent rise in sales.
This year SAIC plans to launch Britain’s first MG in 16 years -- the MG6 “sports fastback” -- and develop a dealer network in the U.K. to sell it.
