In 2022, can Chinese auto enterprises pursue success in overseas auto markets?
According to the data of China Automobile Association, China’s total automobile exports reached 2.015 million in 2021, doubling year-on-year. This is the first time that China’s automobile exports have exceeded 2 million. Among them, SAIC, Chery, great wall, Geely, Byd Company Limited(002594) and other Chinese brands achieved the best overseas sales in 2021.
“Globalization is the only way out for Chinese automobile enterprises. If independent brand cars blindly rely on the Chinese market, do not go out and have no influence in the world, the dividends of more than 20 years will be wasted.” Great Wall Motor Company Limited(601633) chairman Wei Jianjun once said.
When Chinese auto enterprises accelerate the pace of globalization, the European market has become the top priority of the layout of Chinese auto enterprises.
why has Europe become a “pastry”?
Great wall, Chery and other auto enterprises have already made layout in the overseas market. In 2012, China’s automobile export volume reached 1 million for the first time. It is worth noting that at that time, Chinese cars were mainly exported to markets such as South America, the Middle East and Africa, rarely involving markets such as Europe and the United States. Car companies such as Lufeng and Guanzhi intended to enter the European market did not succeed, and even raised doubts about made in China by local consumers.
But in the last year or two, things have changed.
“In the past year, Mg has sold 21000 vehicles in continental Europe, which has tripled compared with 2020. In 2022, we will triple again.” Liu Xinyu, deputy general manager of SAIC International Europe, said at the Saic Motor Corporation Limited(600104) overseas business media communication meeting held on February 17. At present, Saic Motor Corporation Limited(600104) four models launched in Europe, including mg ZS EV, EHS, marvel R and MG5 electric, are new energy vehicles. Saic Motor Corporation Limited(600104) said that in 2022, the sales volume of Mg and Maxus in Europe is expected to reach 120000 units, and Europe will take the lead in upgrading to SAIC’s first “100000 unit” overseas market.
Not only SAIC, but also many auto companies have accelerated the pace of going global. Recently, lantu automobile, a subsidiary of Dongfeng Automobile Co.Ltd(600006) group, announced that it had signed an agreement with China Dongfeng Automobile Co.Ltd(600006) Industrial Import and Export Co., Ltd., officially entered the European market and landed in Norway for the first time. Great Wall Motor Company Limited(601633) brand experience centers will open in Munich and Berlin. Weilai automobile announced that it would accelerate the layout of the European market in 2022 and officially land in Germany, the Netherlands, Sweden, Denmark and other countries.
“Some Chinese auto companies have realized that they need to pay more attention to the developed market and pick the hardest bone to bite. Because the developed market not only brings sales volume, but also helps to improve the whole business system and professionalism.” Yang Junling, director of SAIC Maxus overseas business department, previously told the first financial reporter.
Some technicians of automobile enterprises told reporters that the European Union has the world’s most stringent automobile certification standards. China’s collision test C-NCAP, early test condition NEDC and other standards are derived from Europe or modified in European standards. In order to meet the relevant European standards, automobile enterprises need to have strong technical strength.
“If Chinese users know that this car enterprise can gain market share in Europe, users will have a stronger sense of trust in this car enterprise, which is one of the reasons why many Chinese car enterprises still strive to enter the European market after many failures.” Zhang Xiang, an auto industry analyst, said in an interview with reporters that Europe is one of the developed auto markets. If Chinese auto enterprises can gain a firm foothold in Europe, it will not only help auto enterprises improve their operating revenue and profits, but also form brand advantages.
can Chinese car companies gain a firm foothold in Europe?
Many insiders believe that the rise of new energy vehicle consumption has brought a “window period” for Chinese auto enterprises to enter Europe. Wang Liang (a pseudonym), the management of a car company in Europe, said in an interview with reporters: “this is the best opportunity. If you don’t enter now, you won’t have another chance.” Wang Liang believes that if Volkswagen and other auto enterprises complete the transformation, the advantages of Chinese auto enterprises will no longer exist, and the window period is very short.
At present, SAIC, great wall and other auto enterprises have achieved certain sales results in the European auto market, and car enterprises such as jikrypton and lantu are also seizing the window period to rush into the European market. After the window period, how to gain a firm foothold in the European market and avoid “flash in the pan” is a problem that Chinese car enterprises will face in the future.
Yang Junling told the first financial reporter that China’s auto exports can be divided into four stages. The first stage is pure export products. There is no industrial chain, customer service and brand awareness, and only pay attention to the safety of collection. In the second stage, car enterprises transfer their products, services and spare parts to the general import agent, who will complete the sales and service work in the local market. In the third stage, local operation in overseas markets will be implemented, including local dealer network and spare parts center, after-sales service staff affiliated to the company, marketing team and customer service team affiliated to the brand. The fourth stage is to establish a credible brand locally and realize the internationalization of office location, business income and staff team. Most Chinese automobile companies are still in the second stage and a few are in the third stage.
In the past two years, there have been more and more cases of Chinese car enterprises going to sea systematically. In Xiaopeng automobile’s “going to sea 2.0” strategy, the channel mode of self support + authorization will be established; Great wall, link and other brands have established European companies, covering R & D, sales, management and other functions; SAIC Europe has five subsidiaries and two parts centers, covering 17 countries in Europe.
In the past, most Chinese auto enterprises exported Chinese mature models overseas without localized design, taking into account the regulations and user needs of the local market, and the radiation mode of one-way export centered on China. And that is changing. In 2022, Saic Motor Corporation Limited(600104) will take the lead in releasing the pure electric vehicle EH32 developed for the global market in Europe, Saic Motor Corporation Limited(600104) said that the project was aimed at the European market at the beginning of the project, which is a “global vehicle” in the real sense; Chery recently rolled off the global car omoda 5, which will be listed in more than 30 countries such as Russia, South Africa and Chile, and then exported to new overseas markets such as the European Union, Australia and New Zealand; Recently, yuan plus released by Byd Company Limited(002594) has been listed in China and Australia at the same time, and will enter overseas markets such as Europe and America in the future.
“In the era of fuel vehicles, the products and technologies in China’s automobile market are dominated by the introduction of foreign capital, and the preferences of European and American users are used to cover the needs of Chinese users. However, in the era of intelligent electric vehicles, the attributes of automobile electronic consumer goods are becoming stronger and stronger, and the market leadership and reform will start from China, and the Chinese market will affect the markets all over the world.” The R & D executives of a new power auto enterprise told reporters.
