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World: How the Chinese are setting themselves up for success (Part 4: Asia)

May 31st, 2013 6 comments

Chevrolet Enjoy India May 2013. Picture courtesy of motoroids.comThe Wuling Hongguang launched this month in India as the Chevrolet Enjoy.

* This is Part 4 of 5 in my series on Chinese carmakers abroad. See also Part 1 (Africa)Part 2 (Latin America)Part 3 (Eastern Europe) and Part 5 (Mature markets) *

In the first 3 parts of this series we have observed that Chinese carmakers have managed their expansion into Africa, Latin America and Eastern Europe by securing less developed markets and using them as anchor points for a more widespread presence in these regions. In this context it’s interesting to note that in their own ‘backyard’, Asia, the same strategy has not been met with the same success, with only a handful of small markets in the region ‘cracked’ so far. However as you can expect, Chinese manufacturers are now busy working on correcting that situation, so they can finally surf on what is currently one of the most dynamic car markets in the world.

Chery QQ Myanmar 2012. Picture by Ryusuke IkedaChery QQ in Yangon, Myanmar

In Myanmar, as the market becomes normalised, all 1,000 Chery QQ imported by the Ministry of Industry sold out within a week last December in spite of seeing their original price more than double once various duties, taxes and licensing fees were added. The QQ is now a common sight in the main city in the country, Yangoon, mainly as taxis.

Chery M1 in Luang Prabang, Laos, January 2011.

Laos is the only other South-East Asian market where the Chinese seem to be enjoying very healthy sales, with the Chery M1, QQ & Tiggo, JAC Tongyue and BYD F0 all noticed in the streets of Luang Prabang my dear Mum and Dad during their last trip there in January 2011.

Pyeonghwa Samchunri North KoreaThe Pyeonghwa Samchunri should be the best-selling vehicle in North Korea.

Neighbour North Korea is potentially the market in the world where the Chinese dominate the most, thanks to government links between the two countries. I estimate this based on the observation of rare videos of the streets of the capital Pyongyang. Local manufacturer Pyeonghwa assembles under license the Samchunri (aka Jinbei Haise) which sould be the best-seller in the country, Brilliance BS4, FSV and Huanghai Shuguan, romantically renamed Ppoggugi 4WD.

Micro Panda Sri Lanka February 2013Micro Panda in Sri Lanka

A little more to the West in Sri Lanka, Geely has associated with local brand Micro Cars to assemble and sell the Panda and MK (renamed MX7) to relative success. Micro Cars also assembles and sells Great Wall and Jinbei vehicles and ranked #2 in the country last February. In India, Chevrolet just launched the Enjoy which is in fact a rebadged Wuling Hongguang (#42 in April for its first month) and Chery assembles and sells the QQ in Pakistan, however no sales figures are available so far.

Change Freedom Dushanbe TajikistanChangHe Freedom in Dushanbe, Tajikistan

Another part of the world completely bypassed by most car manufacturers except the Chinese is all the Central Asian former Soviet nations. Even though official data is still rare for these countries, anecdotal evidence show they are present there en masse. For example, did you know that judging by YouTube videos the Changhe Freedom must have been the best-selling car in Tajikistan for a couple of years before such minivans were abruptly banned over safety concerns in 2010? Lifan has been assembling cars in Azerbaijan since 2010 and the MG3 can already be noticed in the streets of the capital Baku. Finally Geely will export part of its Belarus production to Kazakhstan from 2014 onwards…

Geely MK2 Indonesia April 2012Geely MK2 taxi in Bali, Indonesia April 2012

All other significant markets in the region have resisted the Chinese assault so far. Chery apparently assembles cars in Indonesia, Malaysia, Taiwan, Thailand and Vietnam but their only claim to fame to-date has been the 27th place of the Chery Eastar in Malaysia in 2010. Geely assembles in Indonesia but the only models I saw in two weeks in Bali were a few MK2 taxis and one single Panda.

chana-era-cv6-changan-compactMalaysian advertisement for the Chana Era CV6

Hafei launched the Brio as the Naza Sutera in Malaysia in 2006, then renamed it Forza in 2007 without luck while Chana’s attempt at launching the Era CV6 and CM8 there in 2009 also failed. Lifan assembles in Vietnam since 2007 and I did see one 520 sedan in Sapa when I travelled there but it seems DongFeng is having much more luck in the heavy truck sector there. The situation is similar in Iran where Chery and Lifan have been assembling cars since 2006, and even though the Fulwin 2 hit a record #4 last month, the production volumes remain very small.

Manila Auto Show Foton2Foton Thunder at the Manila Motor Show, April 2013

However this situation may change rather quickly, judging at how dynamic the entire Chinese delegation was at the Manila Auto Show in the Philippines earlier this year, as I detailed in my article Manila Auto Show 2013: Has the time come for Chinese manufacturers? According to Leon Herrera, CEO of Chery Motors Philippines, Chery is “aiming at a spot in the Top 5 at the end of 2013 year and between 10 and 15% of the market” by 2015 which is exceptionally ambitious given this is Chery’s second attempt at cracking the Filipino market after the first one failed.

Paradoxically, their proximity with Asia seems to have have worked against Chinese car manufacturers so far, giving a surprisingly less positive balance sheet in a region where defiance towards Chinese domination may have hindered their progress. Potentially not for too much longer. Where there’s a will, there’s a way?

Stay tuned for the final Part of this series about Mature markets!

Categories: China, World

World: How the Chinese are setting themselves up for success (Part 3: Eastern Europe)

May 31st, 2013 3 comments

Vortex Tingo Russia 2012TagAz has been manufacturing the Chery Tiggo in Russia – rebranded Vortex Tingo.

* This is Part 3 of 5 in my series on Chinese carmakers abroad. See also Part 1 (Africa)Part 2 (Latin America)Part 4 (Asia) and Part 5 (Mature markets) *

As illustrated in Africa and Latin America, Chinese manufacturers have been working extra-hard under the radar to secure less developed markets that will form the bulk of global car sales growth over the next couple of decades. Their approach to Eastern Europe is very similar. There are currently three Chinese assembling hubs in the region – in Russia, Ukraine and Bulgaria – acting as a very convenient springboard for further expansion throughout the continent, including all the ex-USSR nations and potentially Western Europe.

Police Lifan Solano in Moscow, Russia

Even though their market share is limited to around 3% for now, Russia is currently the overseas country delivering the largest volume for Chinese manufacturers with 83,207 sales in 2012, up a whopping 50% on 2011. Import tariffs are too high to allow sizeable direct imports from China, so the 4 main Chinese carmakers present here have already all invested very significantly to assemble locally and as a result are registering extremely strong growth rates so far in 2013: in April Geely was up 88% to #23 brand, Great Wall up 124% to #25, Lifan up 21% to #27 and Chery up 16% to #28.

Chery Amulet Russia 2007The Chery Amulet was one of the first successful Chinese models in the region.

Chery has the longest (and most troubled) history in Russia: the Chery Amulet ranked within the monthly Top 20 as early as 2007 but the brand saw sales plummet on the back of poor quality perception, to which Chery responded by rebranding their cars Vortex. Since last year though, the Chery brand is back in Russia with encouraging success. Model-wise, the Lifan Solano (aka 620) was the best-seller in 2012 at #41 followed by the Geely MK (#54), Great Wall Hover (#55) and Vortex Tingo (aka Chery Tiggo – #95).

Geely CK Ukraine March 2012The Geely CK has managed to top the Ukrainian models ranking 3 times already.

Although Russia does not qualify as a “less developed” market, its structure heavily weighted towards low-cost models like the Lada range and Renault-branded Dacias make it one of the biggest opportunities for Chinese manufacturers worldwide. However in Eastern Europe too, it’s in the developing car markets that we see the Chinese grab their highest market share. Ukraine is the only market in the world with regular available sales data outside China to have repeatedly crowned a Chinese models in the monthly rankings. The Geely CK ranked #1 there in July 2012, December 2012 and January 2013 and was among the Top 10 best-sellers for 9 of the last 12 months.

Geely SC7 Belarus 2013The Geely SC7 will be assembled in Belarus later in 2013

But the CK is not a one trick pony: Geely was the 2nd most popular brand in Ukraine in March 2013 below just Hyundai with 7.5% share, it is up 205% year-on-year in April and ranks #4 so far in 2013… The Geely Emgrand EC7 hit #9 in March 2013, the MK-2/Cross was #15 that same month and the MK was #19 last September. All in all Chinese carmakers currently command around 10% of the Ukrainian car market.

ZAZ Forza Ukraine 2013Chery sells the Fulwin 2 as the ZAZ Forza in Ukraine

Other Chinese actors in Ukraine include Chery, 25th brand so far in 2013, BYD up 504% in April to 26th and placing the F3 at #42, Great Wall at #32 and MG at #34, placing the MG 350 at #77 in April. Another example of Chinese manufacturers immersing themselves in the local culture, Chery manufactures at the local ZAZ plant from CKD kits and sells the Chery Fulwin 2 as the ZAZ Forza which ranked among the Ukrainian Top 10 from May to August 2012.

Great Wall Voleex C10 Bulgaria June 2012bBulgarian police has already adopted the Great Wall Voleex C10

Another milestone event for Chinese manufacturers in Eastern Europe was the opening of the Great Wall factory in Lovech, Bulgaria, in February 2012. This is the very first automotive plant set up in Bulgaria and as a result Great Wall has played the ‘made in Bulgaria’ card to the fullest since, with great results: it was #10 brand in the country over the first 6 months of 2012 and quickly went up to #2 overall with 10.5% share below just Volkswagen in October and December 2012, placing the Steed pick-up in pole position that same month, the Voleex C10 at #2 in April 2013 and the Hover at #6 in December…

Great Wall’s Bulgarian hub is planned as the focal point for their expansion throughout Europe, and Bulgarian exports have already started to trickle down in sales stats for countries like Macedonia where in December 2012 Great Wall was the #10 brand with 4.7% share and the Voleex C10 was #5 model at 3% share. This expansion will likely reach more neighbouring markets in the near future, once again the less mature ones like Serbia (where Chery ranked #25 in 2012), Bosnia, Kosovo, Montenegro and potentially Albania and Moldova.

A fourth Chinese assembly hub is scheduled to open in the region this year in Belarus, where Geely has set up a joint venture with Belarusian company BelDzhi and is in the process of launching the locally assembled SC7. The assembly facilities, located in Zhodino and Borisov, are scheduled to produce 60,000 cars/year for the first three years, with capacity potentially doubling in 2017. From that 4th hub, exports towards Russia and Kazakhstan are on the cards.

Launching from their 3 hubs in Russia, Ukraine and Bulgaria and potentially a 4th one in Belarus, Chinese carmakers are getting ready to expand further in Eastern and Western Europe in the very near future. Russia will remain by far their biggest opportunity in the region with local assembly plants already in place and ready to gear up to surf on the growing demand for affordable cars in that market.

Stay tuned for Part 4 of this series: Asia!

Thailand Pick-ups April 2013: Isuzu D-Max back on top

May 31st, 2013 No comments

Isuzu D-Max 2013Isuzu D-Max

* See the Top 8 best-selling pick-ups by clicking on the title! Many thanks to Austin *

As is the tradition on BSCB, we are following the evolution of 1-ton pick-up sales in Thailand, where most of them are manufactured for the rest of the world. 60,294 new pick-ups found a buyer in Thailand in February, bringing the year-to-date total to 159,781. For the third time in the last 5 months after December and February, the Isuzu D-Max is back to being the most popular vehicle in the country, passing the Toyota Hilux to sell 19,247 units for a mammoth 40.1% share of the pick-up market vs. 19,140 and 39.8% for the Hilux. These two models are the only ones to register a higher market share than their year-to-date levels…

Previous Thai post: Thailand 2 months 2013: Discover the Top 40 best-selling models!

Previous month: Thailand Pick-ups March 2013: Toyota Hilux reclaims throne

One year ago: Thailand Pick-ups April 2013: Chevy Colorado and Mitsubishi Triton up

Full Top 8 models Ranking Table below.

Read more…

Categories: Thailand

UK April 2013: Fiat 500 up to highest ever 8th place

May 30th, 2013 36 comments

Fiat 500 UK 2013Fiat 500

* See the Top 10 best-selling models and Top 44 All-brands by clicking on the title! *

Check out CarGames.co.uk here.

Simply breathtaking. That’s what the continuous growth of the UK new car market really is, now celebrating its 14th consecutive month of year-on-year gain in April at +15% to 163,347 registrations, all this in a very depressed European context. Even more impressive, this best April score since 2008 is lifted by private sales, up a huge 32% year-on-year! The year-to-date total stands at 768,555 units, up a brilliant 9% over 2012. The Ford Fiesta holds onto its newly reacquired pole position but sees its market share slip down to 4.9% at 8,083 units.

Audi A3 UK April 2013Audi A3

Check out Exhausts in the Aston area here.

Like last month, the Fiesta is followed by the Vauxhall Corsa (3.7%), Ford Focus (3.6%), VW Golf (3.2%), Vauxhall Astra (2.6%), Nissan Qashqai (2.3%) and VW Polo (2.2%). A very stable ranking indeed. The Fiat 500 is back within the Top 10 for the first time since last June and manages to reach a best-ever #8 with an excellent 3,037 sales and 1.9%. It is its 7th Top 10 month in the country after October 2009 (#10), December 2009 (#9), January 2010 (#10), April 2012 (#10), May 2012 (#10) and June 2012 (#10).

Nissan Juke UK April 2013Nissan Juke

Another rare appearance in the UK Top 10 this month is the Audi A3 at #10 with 2,935 units and 1.8%. The last time the A3 was among the 10 most popular cars in the country was last August. Finally, even though it hasn’t ranked in the Top 10 for the last 2 months, the Nissan Juke manages to improve its year-to-date position to a best-ever #9 thanks to 12,788 sales and 1.7%. In the brands ranking, Dacia continues to impress, selling as many units in April alone (2,016) than in the last 3 months combined (1,978) and now up to #21 in-between Volvo and Mazda…

Check out Quality Car Servicing in Ilford and Barking here.

Previous post: UK January-March 2013: Discover the Top 328 best-sellers!

Previous month: UK March 2013: Ford Fiesta reclaims top spot

One year ago: UK April 2012: Fiat 500 in Top 10 for the first time in over 2 years

Full April 2013 Top 10 models and Top 44 All-brands Ranking Tables below.

Read more…

Categories: UK

New York Full Year 2012: Honda Accord, CR-V & Civic best-sellers!

May 30th, 2013 6 comments

Honda Accord New York 2012. Picture courtesy of tier10lab.comNew Yorkers prefer the Honda Accord

* See the Top 5 best-selling models, brands and automakers by clicking on the title! *

For the very first time on BestSellingCarsBlog I can share with you detailed car sales data for New York City, the largest of 211 DMA (Designated Market Areas) in the USA, representing 7.8% of overall US sales in 2012, 1.8 point more than runner-up Los Angeles. And what a different market it is! Structurally, one the main characteristics of the New York market is its bias towards luxury vehicles and leases. The luxury segment is twice as big in New York as it is everywhere else, representing one in every four sales, and 45% of all new vehicle transactions in New York are leases vs. 16% elsewhere.

Honda CR-V New York 2012The Honda CR-V is #2 in New York

If General Motors and Ford are the two biggest automakers (not brands) outside of New York, they are nowhere to be seen in the New York Top 5, with Fiat-Chrysler passing them to rank #5 below 4 Asian makers: Honda dominates with 17.6% share followed by Toyota at 14.3%, Nissan at 11.2% and Hyundai at 9.5%… The brands ranking is very similar and crowns Honda at 15.1% ahead of Toyota at 11.3% and Nissan at 9.2%… Not particularly fans of American cars those New Yorkers!

Ford F-Series New York 2012#1 overall in the US, the Ford F-Series is a very rare sight in New York…

In terms of formats, here too some significant differences between New York and the rest of the US. For example, pick-up trucks are the 4th most popular segment overall in the US but only 14th in New York. Illustrating this, if the Ford F-Series and Chevrolet Silverado frankly dominate the sales charts outside of New York, they rank respectively #32 and #53 in New York…

Hyundai Sonata New York 2012The Hyundai Sonata is #4 in New York, ahead of the Toyota Camry

There is indeed a big surprise atop the New York models ranking: the podium is monopolised by Honda! The Accord is the most popular vehicle in the Big Apple with an impressive 4.8% share, followed by the CR-V and Civic. In fact, as expected given the automakers and brands rankings above, there are no American cars in the Top 5, with the Hyundai Sonata taking the 4th spot followed by the Toyota Camry…

Previous USA post: USA May 2012: Sales expected to bounce back

Full Year 2012 Top 5 models, brands and automakers Ranking Tables below.

Read more…

Categories: New York (USA), USA

Uruguay 4 months 2013: Chevrolet down, Chery and FAW up

May 30th, 2013 No comments

FAW V2 Uruguay April 2013. Picture courtesy of avtoed.comFAW V2. FAW is now among the Top 10 most popular brands in Uruguay.

* See the Top 20 best-selling brands by clicking on the title! *

While writing my summary article about how Chinese carmakers are setting themselves up for success in Latin America, I realised I hadn’t updated you about the Uruguayan car market for over a year. And a lot has changed since my last article so a new one is overdue. After gaining 3% in 2012 to reach a record 53,233 registrations, new car sales in Uruguay are up a further 9% to 16,744 units over the first 4 months of 2013. The big news is the fragmentation atop the market, with leader Chevrolet going from 25.3% share in 2011 to just 15.7% so far in 2013 while #2 Volkswagen has dropped from 12.1% to 10.9% in the same period of time.

Reversely, Nissan is up from 5.9% to #3 and 8.1% and Fiat is up from 6.6% to 7.6%. But the main source of interest in the Uruguayan car market is how well Chinese manufacturers are doing. In fact, Uruguay could potentially be the country in the world where they have the strongest market share at 25.3% of passenger cars so far in 2013! If a 6.6% share allowed Chery a world-best third position in 2011, it improves on this score in 2013 thanks to 1,136 sales and 6.8% but ranks “only” 5th. FAW is the second Chinese brand to ever break into the Uruguayan Top 10 at #10 so far in 2013 thanks to a market share up a full percentage point on 2012 to 3.9%.

Further down, Geely is up from #14 and 1.8% in 2012 to #12 and 2.6%, Great Wall is up from #16 and 1.6% to #14 and 2.2%, DongFeng up from #17 and 1.5% to #16 and 1.7%, Haima up to #19 at 1% and BYD down from #15 and 1.7% to 20 and 0.9%. 19 additional Chinese manufacturers are officially present in the country: Anchi, Brilliance, Chana, Changhe, Effa, Foton, Gonow, Hafei, JAC, JMC, Lifan, MG, Orient, Shineray, Wuling, Xinkai, Zna, Zotye and ZX Auto!

Previous post: Uruguay Full Year 2012: Chery now third best-selling brand!

4 months 2013 and Full Year 2012 Top 20 brands Ranking Tables below.

Read more…

Categories: Uruguay

China LCV April 2013: Wuling Sunshine reclaims throne

May 30th, 2013 No comments

Wuling Sunshine China April 2013. Picture courtesy of 360che.comWuling Sunshine

* See the Top 5 best-selling LCV and Top models overall by clicking on the title! *

Sales of new Light Commercial Vehicles are up 5% year-on-year both in April at 456,651 registrations and year-to-date at 1,886,368 units. After 3 consecutive months of domination by the Wuling Hongguang, the Wuling Sunshine, leader in 2010, 2011 and 2012, reclaims the top spot in April thanks to 45,861 sales, down just 1% compared to April 2012. For comparison, Ford F-Series sales in the US in April=59,030 and VW Golf sales in Europe=43,175. The Hongguang stays in the lead year-to-date however at 193,092 units (+27%) vs. 171,243 (-14%) for the Sunshine.

Excellent month for the Foton Forland up to a shiny second spot with 35,899 sales (+4%), it however remains 5th year-to-date at 128,667 units. The Wuling Rongguang/Xingwang is also up 2 spots on March to #3 with 34,911 sales while the ChangAn Minibus is up 25% year-on-year but down 3 ranks on last month to #5. In the overall all-models ranking, the podium is once again monopolised by Light Commercial Vehicles with the VW Lavida arriving at #4 and the Ford Focus at #6. Notice also the Honda CR-V up to #8 overall.

Previous month: China LCV March 2013: Wuling Hongguang above 50,000 sales

One year ago: China LCV April 2012: Wuling Rongguang and Hongguang shine

Full April 2013 Top 5 LCV and Top 10 overall models Ranking Tables below.

Read more…

Categories: China

World: How the Chinese are setting themselves up for success (Part 2: Latin America)

May 29th, 2013 5 comments

Chery QQ Brazil May 2011Brazilian Chery QQ

* This is Part 2 of 5 in my series on Chinese carmakers abroad. See also Part 1 (Africa)Part 3 (Eastern Europe)Part 4 (Asia) and Part 5 (Mature markets) *

If Chinese carmakers have started exporting to Africa in the early 00′s, they set foot in Latin America even earlier, with JAC starting to export trucks to Bolivia back in 1990. Similarly to the strategy they adopted in Africa, the Chinese have initially focused on the less developed car markets in the region. They are now in the process of stepping up their involvement by launching in the bigger, more mature markets like Argentina and Brazil.

FAW S80 Uruguay 2013FAW S80. FAW is the 10th most popular brand in Uruguay vs. #16 at home in China.

In fact, the foundations the Chinese have built in secondary Latin American car markets are potentially their strongest in the world so far. The first logical anchor points in the region are Uruguay and Paraguay, both located between Argentina and Brazil and all part of the Mercosur, which makes it easier to export towards those two powerhouses as local assembly with 30% to 50% share of local components currently receive zero-tariff status inside the Mercosur. As a result both Chery and Lifan (40,000 units/year capacity) have assembly factories in Uruguay while Dongfeng has one in Paraguay.

In Uruguay, 26 of the 60 brands on sale are Chinese, capturing 23.4% of the market so far in 2013 – their highest country penetration outside of China and actually on par with the penetration of Chinese passenger cars within China! There are 7 Chinese carmakers in the Uruguayan Top 20 and 2 among the Top 10: Chery is 6th with 6.8% share after peaking at #2 and 12.2% share in June 2011. FAW is 10th at 3.9%, followed by Geely at #12 and 2.7% and Great Wall at #14 and 2.2%. For comparison Toyota ranks #13 with 2.6% of the market… 

DongFeng Mini Pick-up Paraguay 2012The DongFeng Mini Pick-up is now produced in Paraguay.

In Paraguay, the Chinese hold 9% of the passenger car market but 59% of the truck market! There were 10 Chinese among the Top 30 best-selling brands in 2012, led by Dongfeng which now produces pick-ups locally, up 57% to #11, Great Wall at #18, ChangAn at #21, Haima at #22, Foton at #23 and ChangHe at #24.

Geely CK Cuba October 2011Geely CK Police car in Cuba

Peru is another very important hub for Chinese manufacturers in Latin America: it is one of the fastest growing car markets in the world, with the last 3 years all being new records topped up by 178,000 registrations in 2012, and is “facing” China on the Pacific Ocean, making it an enticing port-of-entry into the continent. Roughly 15% of the Peruvian car market go to Chinese models, and latest data shows JAC at #9 in the overall brands ranking and Chery at #10 in the passenger cars one, with Great Wall at #12 and Geely at #19.

Local analysts even estimate that as much as 96 Chinese car brands (who knew there even were that many?!) are sold in Peru both formally in dealerships and informally by rogue vendors…

DongFeng S30 Venezuela February 2013The DongFeng S30 was the best-selling model in Venezuela in December 2012…

Venezuela is a slightly different situation because the exchanges with the rest of the region are more patchy, so the Chinese’s success so far has stemmed either from local production – Chery has started assembling cars there in 2011 but no figures are available – or direct agreements with the Chinese government, like the unprecedented 4,000-unit batch of DongFeng S30 imported in late 2012 which enabled the model to simply take the lead of the sales charts last December. The S30 has since celebrated its 5th consecutive month within the Top 5 best-sellers in Venezuela last month.

Chevrolet N300 Colombia December 2011Chevrolet N300

If we go up one notch to Chile - yet another record-breaking market at 340,000 sales in 2012, we notice that the best-selling model in the country, the Chevrolet Sail, is actually imported from China. Chinese brands have a 7% market share, with no less than 18 of them represented in the brands ranking. They are led by Great Wall at #11, Chery at #16, JAC at #20, Geely at #26, BYD at #27 and Hafei at #30. In Colombia, there is one (hidden) Chinese model in the Top 40 in 2012: the Chevrolet N300 which is actually a rebadged Wuling Rongguang, up 171% to #18. Bolivia and Ecuador, although no sales data is available, are two other developing Latin American markets likely to have seen a recent flood of Chinese cars.

The Caribbean region is yet another under-developed zone most carmakers traditionally sidestep, except the Chinese. Geely regularly ships cars to Cuba, the last batch from October 2011 was composed of 1,300 Geely CK (now a common sight in La Habana as a police car) and 250 Emgrand EC7. In the Dominican Republic, a few Chinese models have already managed to break into the Full Year Top 20 like the BYD F3 (#9 in 2010), the DongFeng Cargo Van (#14 in 2011) and the Jinbei Haise (#18 in 2011).

JAC J3 Brazil December 2011Brazilian JAC J3

This all means that Chinese carmakers have now established a solid footing in almost all Latin American markets,  working extremely hard hard to secure the foundations for long-term success in the region. They are now using these stepping stones to access Argentina (800,000+ annual units) and Brazil (record 3.6 million units in 2012), where the volumes really are. In Argentina, Chery has started assembling a limited amount of cars locally and as a result has seen a few models make their way up the ladder: both the Chery QQ (#47) and Tiggo (#53) reached their highest ranking so far in the country in March 2013.

In Brazil, JAC broke with the Chinese tradition and chose to enter the market all guns blazing on 18 March 2011, which they called J-Day. They simultaneously inaugurated 50 dealerships across the country and hired a famous TV presenter, Fausto Silva, as their ambassador in a multi-million dollar TV campaign (watch above).

JAC J2 Brazil February 2013. Picture courtesy of autossegredos.com.brThe JAC J2 is now the best-selling Chinese model in Brazil (#64 in April 2013)

However JAC’s strong start in the country has since fizzled out. The JAC J3 hatchback (#36) and J3 Turin sedan (#56) both hit their highest ranking only 3 months after launch in June 2011 while in the meantime the Chery QQ peaked at #36 in September 2011, but 2012 was harsh: J3 at -37%, J3 Turin at -40% and QQ at -25%, on the back of increased levies on imports. Now both manufacturers realise their success in Brazil lies in local assembly: Chery is reportedly building a 150,000 annual unit-production facility in the São Paulo state while JAC is set to open a 100,000 annual vehicle-plant in the state of Bahia in 2014.

A very strong base in Latin America’s developing markets should ensure Chinese manufacturers surf on these markets’ predicted explosive growth in the next coming decades. The next challenge is to manage to crack more mature markets like Brazil and Argentina and this will require a much more significant level of investments in the form of large scale manufacturing operations. But the rewards could be priceless: thanks to its brand-new factory producing models tailored to Brazilian tastes, Hyundai has tripled its market share in the space of a few months… No doubt the Chinese are watching with tremendous interest.

Stay tuned for Part 3 of this series: Eastern Europe!

Categories: China, World

India: What changed in the last two years

May 29th, 2013 2 comments

Tata Nano India April 2011The Tata Nano sold 10,021 units in India in April 2011

* See the April 2011 and April 2013 Top 30 best-selling models by clicking on the title! *

The Indian car market has gone through a lot of change in the last 2 years so today I thought I would put the April 2011 and April 2013 Indian models rankings side by side and extract a few long-term trends. First things first, the Maruti Alto has not moved from its pole position but is down 22% to 19,847 sales. In fact the Alto has been #1 in India every month since except exactly one year ago in April 2012 when it was toppled by the Maruti Swift. The Swift family is actually the big gainer over the period: the DZire sedan has gone from #4 with 11,797 sales two years ago to #2 and 19,446 and the Swift hatchback from #5 and 10,622 units to #3 and 16,531.

Maruti Alto 800 India April 2013Maruti Alto 800

If two years ago Hyundai managed to place the i10 in 2nd place, Maruti now monopolises the Top 4, with the Mahindra Bolero the most popular non-Maruti model at #5 (vs. #11 in 2011). However there are 3 Hyundais in the Top 10 like in 2011: the Eon at #6, i10 at #7 and i20 at #8. One of (if not the) biggest changes in the last two years has been the fall and fall of the Tata Nano. In April 2011 the Nano sold 10,021 units (its first and only time above 10,000 monthly sales) and ranked 6th but last month it was down to 39th with just 948 sales.

Renault Duster India 2013Renault Duster

Renault has done the impossible and gone from virtually nothing two years ago to 6,000+ monthly sales this year, thanks to one model: the Duster which brilliantly ranked 10th last month with 5,362 units. Other newcomers in the ranking include the Maruti Ertiga at #11, Honda Amaze at #13, Chevrolet Sail Sedan at #23 and Mahindra XUV500 at #24…

Previous post: India April 2013: Maruti DZire threatens Alto for pole position!

One year ago: India April 2012: Maruti Swift 4th model since 1950 to rank #1!

Full April 2011 and 2013 Top 30 Ranking Tables: click on ‘Read more’ below.

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Categories: India

Strategy: How the Chinese are setting themselves up for success

May 28th, 2013 7 comments

Fennec fox. Picture courtesy of Fransisco Mingorance:National Geographic Traveler Photo ContestLike this fennec fox, Chinese carmakers have been walking against the wind in Africa. And it’s worked.

* This is Part 1 of 5 in my series on Chinese carmakers abroad See also Part 2 (Latin America)Part 3 (Eastern Europe)Part 4 (Asia) and Part 5 (Mature markets) *

For the first time in the history of car manufacturing, Chinese carmakers sold 1 million cars outside of China in 2012. They are now relying more and more on export markets to boost their bottom-line, especially as conditions have worsened for local passenger cars at home over the last couple of years. However as I described in my article “China: How local brands may finally find their mojo at home“, the Chinese are learning how to sell low-cost overseas and applying these strategies at home, making themselves more competitive in the process.

In fact, while the long-dreaded Chinese ‘invasion’ of the West European and American car markets is still a long way off, Chinese manufacturers have been working extra-hard under the radar to secure less developed markets that will form the bulk of the global car sales growth over the next couple of decades.

And this is why they will win.

Speranza A516 EgyptSperanza A516 in Cairo, Egypt

First case in point, Africa.

Apart from Toyota, Hyundai and a bunch of other Japanese manufacturers, no one currently has a lot of time for a continent that is still finding its way into development. Except the Chinese who started assembling cars there almost a decade ago, as part of a push to be deeply involved in the infrastructure building of the continent. So we’re not just talking cars, but roads, rail tracks, mining and much more.

Egypt was the first cab off the rank when Chery used the Cairo plant previously run by Daewoo to assemble its cars under the Egypt-exclusive Speranza brand in 2004 – apparently because the Chery brand suffered poor quality perceptions after an earlier launch there. Success: Speranza was the 4th most popular passenger car brand in Egypt between 2008 and 2011, selling more than Toyota! Successful models include the A516 (#9 from 2007 to 2009) and the Tiggo (#14 in 2011). Since 2012 however, other Chinese manufacturers have stepped up a notch in Egypt…

Golden Dragon Haice Egypt 2012The Golden Dragon Haice was the best-selling Chinese model in Egypt in 2012.

The Golden Dragon Haice managed to rank as high as #6 in September 2012 and finished the year as the best-selling Chinese model at #15 while the Geely Emgrand EC7 also has already peaked at #6 and 3.8% share in March 2013 less than a year after its initial launch in the country. King Long, Brilliance and JAC models have also started to appear within the monthly Top 30. As a whole,
Chinese manufacturers commanded 9% of the overall Egyptian market in 2012, which as you will see below is actually not their best share in the continent…

Holland Car Abay V2Holland Car assembles the Abay (aka Lifan 520) in Ethiopia.

In Ethiopia, Lifan and JAC have cooperated with Holland Car, the country’s first car brand, to assemble models locally including the Holland Car Abay (a rebadged Lifan 520),Tekeze (JAC Tongyue) and Awash (JAC B-Class), all named after Ethiopian rivers. Since 2010 Lifan assembles cars under its own name in the country and has recently introduced the X60 SUV. No sales data for that country so it’s hard to gauge their success (not as high as Lifan would want according to somalilandpress.com) but a second example of clever re-branding to fit the local culture as a first step.

Foton Slip SUP Kenya 2012The Foton SUP is assembled in Kenya since 2011.

In Kenya, Foton launched its first domestically produced truck, the SUP pick-up, in June 2011 using an existing local factory, and has opened its own US$50m assembly plant in Nairobi in March 2012 with a capacity of 10,000 annual units. Chery is also thinking about a Kenyan plant, initially limited to produce 1,000 units in 2013. As a result, Chinese manufacturers now hold 20% of the Kenyan car market…

Geely Emgrand EC8 Kuwait. Picture courtesy of qabaq.comGeely Emgrand EC8 in Kuwait

Either from these 3 assembling hubs or through straight exports from China, Chinese carmakers are organising their expansion towards other African countries. The Egyptian hub makes it more practical to export to Libya, Algeria, Sudan, Syria, Jordan, Saudi Arabia, Kuwait, the UAE and Iraq notably, where the Great Wall Deer seems to be particularly successful. Another potential hub for the region could be Iran where Chery has been assembling cars since 2006, with the Fulwin 2 hitting a record #4 last month.

JAC Tojoy MadagascarJAC was the #2 most popular brand in Madagascar at the end of 2012.

Ethiopia and Kenya can also be used as relays to Tanzania, Mozambique or Madagascar where JAC already has an extremely solid presence (#2 brand with over 8% share) below just Nissan in Q3 2012. Further West, Chinese carmakers now hold 20% of the Senegal and Cote d’Ivoire markets, with latest Cote d’Ivoire showing Great Wall at #10 in 2010. The logical next step in Western Africa for Chinese car makers would be assembling cars in Nigeria…

Assembling cars in Nigeria would enable them to carve up a significant market share there as well as in neighbouring Ghana, Cameroon, Gabon, Mali and Burkina Faso, all at various stages of development but destined to grow fast in the next decade and beyond. South Africa also seems to be a missing link right now, however when you realise that it is actually the only mature market on the continent, it’s easier to understand why the Chinese haven’t spent too much energy trying to crack it yet. I will spend more time talking about Chinese carmakers’ strategies in mature markets in Part 5 of this series.

ZX Auto GrandTiger Libya 2011aZhongXing/ZX Auto GrandTiger in Libyan Civil War outfit

Another way Chinese models have come under the spotlight in export markets has been through government agreements, notably in Libya, albeit in a totally unexpected way (you will see its impact on the Cuban car market in the next installment of this series). During the 2011 Arab Spring, Libyan rebels got their hands on a batch of 5,000 ZX Auto GrandTiger pick-ups that the government had recently received and fit their heavy artillery on them, catapulting the vehicle onto worldwide TV screens for a solid 6 months. A marketing opportunity that ZX Auto fully embraced, boasting about its reliability and featuring the Libyan civil war on giant LED screens at the 2012 Beijing Auto Show (see the full Libya article here).

Stay tuned for Part 2 of this series: Latin America!