Best Selling Cars – Matt's blog

The Hawtai Lusheng E70 is one 50 all-new models in the Chinese ranking (#282).

* See the Top 315 All-models ranking by clicking on the title! *

Now that we have explored May sales in detail and focused on the 5 all-new models entering the Chinese ranking this month, let’s have a closer look at the year-to-date sales charts to extract longer-term trends. Overall the Chinese Passenger Car market is up 15% year-on-year after 5 months in 2013 to a record 7,261,600 sales. The Top 2 best-sellers continue to smash records, both almost doubling their sales year-on-year: the VW Lavida is up 90% to 185,957 units while the Ford Focus is up 87% to 154,198 sales. The Buick Excelle takes advantage of a slightly weaker month of May from the Chevrolet Sail to climb back on the year-to-date podium at 124,832 units, up just 2% and down from the pole position it held at the same time last year.

The ZhongXing Landmark ranks #229 so far in 2013 in China (+12%).

The VW Sagitar delivers the biggest year-on-year gain of the Top 10 thanks to the new model, up 135% and 27 spots to #5 with 113,506 sales. It leads a series of 4 consecutive Volkswagens in the ranking, making it 5 in the Top 8 so far in 2013: the Passat at #6, Jetta at #7 and Bora at #8. The Nissan Sylphy also impresses once again at +84% and 20 ranks to #9 at 93,986 units, the best-selling Japanese model in China so far in 2013 ahead of the Honda CR-V (#16), Toyota Camry (#21) and Corolla (#26).

The Chevrolet Captiva lands at #123, 13th most popular all-new model in China.

As it has been the case pretty much since its launch last August, the Hyundai Elantra Langdong is the most popular all-new model in the Chinese ranking at #13 with 85,247 sales, ahead of the Kia K3 at #30 and 57,555 units and the BYD F3 Surui at #32 with 53,803 sales. There are no less than 50 all-new models in the ranking but a more reasonable 11 in the Top 100, including the ChangAn Yuexiang V3 at #64, Hyundai Santa Fe at #69, Ford Kuga at #76, Brilliance H230 at #82, Buick Encore at #95 and Peugeot 3008 at #100.

The 1998 Hyundai Sonata is still on sale in China with a front grille facelift (#192).

As far as local models are concerned, the Great Wall Haval H6 confirms the pole position it snapped last month, ranking #18 with 74,653 sales ahead of the Emgrand EC7 at #19 and 73,044 units, the Great Wall Voleex C30 at #23 and Chery QQ at #24. There are only 11 locals in the Top 50 so far in 2013, including the Dongfeng Future at #37 (+67%), Great Wall Haval M4 at #39 (+1196%), BYD L3 at #42 (+51%) and Roewe 350 at #50 (+41%).

The Hafei Saima is becoming rarer (-80% to #289)…

The local low-cost model race now has a clear winner: the Venucia R50/D50 is up 371% year-on-year to #56 with 36,069 sales while the Baojun 630 is already down 19% to #78 at 26,843 units. Both the Linian S1 at #172 and the Ciimo Si Ming at #182 have never taken off. Other interesting developments include the Zotye Z300 up 3753% to #94 and the Beijing E-Series (a clone of the previous gen Mercedes B-Class) up 1535% to #125. A couple of oddities to notice: the 1998 Hyundai Sonata (two generations ago) still on sale as the Sonata MoInca (#192) and the 2000 Elantra (also two generations ago) at #132 while the Hafei Saima’s distinctive bonnet is slowly disappearing from Chinese roads (-80%)…

Previous post: China May 2013: Focus on the all-new models

May update: China May 2013: VW Lavida leads, Ford Ecosport up

Previous month: China 4 months 2013: Great Wall Haval H6 now best-selling local

One year ago: China May 2012: Chevrolet Sail leads the way, Ford Focus #2

Full 5 months 2013 Top 315 All-models Ranking Table below.

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The Beijing Senova D is based on the Saab 9-5.

* See the Top 304 All-models ranking by clicking on the title! *

Today I inaugurate a new series on BSCB. With the Chinese new car market growing and evolving at breakneck speed and displaying more and more models, I figured it could be a good idea to focus on the models that enter the ranking each month. This way we are all aware of the latest newcomers in this fascinating market. Note these will always be models manufactured in China as import stats are still a little wobbly for China. You can also check out the general China May 2013 article here.

VW Gran Lavida

In May we welcome 5 all-new models in the Chinese ranking. The most popular is the VW Gran Lavida, which is none other than a compact station wagon version of 2013′s best-seller. I may decide in the next few months to count its sales along with the Lavida but given it has been baptised with a slightly different nameplate let’s consider it as an all-new model for now. Borrowing its rear from the Audi A3 sportback, the Gran Lavida sells 2,021 units for its first month in market to rank at #157. It will be interesting to follow the career of the Gran Lavida as China does not have a history of strong station wagon sales…

The next best-selling newcomer in China in May is the Beijing Senova D. Now there is an interesting story behind this model. The Senova D is produced by Beijing Automotive Industry Holding Co. (or BAIC) which I abbreviated as Beijing, and under its bonnet is the platform and engine technology of feu the Saab 9-5, the rights for which BAIC bought from General Motors in 2009. After being unveiled at the Shanghai Motor Show, the Senova D was launched on May 13 in China with a big budget 90 second commercial featuring American actor Nicolas Cage (see video above) and a decidedly sporty positioning… The Senova D enters the Chinese ranking at #225 with 517 sales.

Dongfeng Fengguang

At #242 with a still shy 308 units we find the Dongfeng Fengguang, a mini MPV with the front of a VW Touran. Dongfeng has been very successful at home in the MPV segment with its 3 best-sellers being MPVs. It even improved its scores in 2013 with the Future up to #37 and #2 best-selling MPV in the country year-to-date vs. #60 in 2012, the Joyear at #72 YTD and the Shuai at #117 this month vs. #140 YTD. The Fengguang is smaller so may follow a different trajectory but this first month of sales is a little weak for it to hope to shake the ranking this year.

BAW (Beijing) 007

The BAW (Beijing) 007 makes its first appearance in the Chinese ranking this month at #253 with 219 sales and even though it borrows its name from James Bond (I wonder how BAW managed that feat), it has nothing slick about it and looks like it could have been launched 15 years ago. That could be because it was originally unveiled at the Beijing Motor Show in… April 2010, but somehow hasn’t shown up in the sales charts since. The 007 could potentially work in the Chinese Far West where buyers are less concerned with brand image and need a robust (?) SUV to tackle rough roads.

FAW Hongqi H7

Finally the last new entrant in the Chinese new car market in May is the FAW Hongqi H7 at #270 with just 76 sales. Now this is a fascinating one. Hongqi (“Red flag” in Chinese) is a luxury marque now owned by FAW but Hongqi cars were the first domestically produced Chinese passenger vehicles in 1958! They were only for high-ranking party elite who now prefer Audis… Within the FAW stable of brands, Hongqi actually competes with Besturn and as a result showrooms for both brands were merged in 2008. There had only been 4 Hongqi models produced since 1958, successively based on the 1955 Chrysler, Audi 100, Lincoln Town Car and Toyota Crown Majesta. The Hongqi H7 is therefore only the brand’s 5th model in 55 years! Note the grille based on the traditional design of a Chinese fan which has been a distinctive feature on all Hongqis since 1958.

Previous post: China May 2013: VW Lavida leads, Ford Ecosport up

Previous month: China April 2013: Honda CR-V up to #4, Nissan Teana takes off

One year ago: China May 2012: Chevrolet Sail leads the way, Ford Focus #2

See more info on these models and the May 2013 Top 304 All-models below.

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Ford Ecosport

* NOW UPDATED with the Top 304 All-models ranking! Click on title to see *

New Passenger Car sales in China are up 9% year-on-year to 1,419,700 registrations, bringing the year-to-date total to 7,261,600 units, up an impressive 15% on 2012. As it gets bigger the Chinese market seems to stabilise a little: the models sales charts podium is identical in May as it was in April and as it is year-to-date: the VW Lavida leads the way, up 55% to 30,534 sales, the Ford Focus is #2, up 18% to 27,345 units and the Buick Excelle rounds up the podium, up 7% to 24,756 sales. Excellent month of the VW Sagitar up 65% to #4, of the VW Passat up 67% to #7 and of the Nissan Sylphy up 74% to #8.

Kia K3

In fact, Volkswagen places 7 models in the Top 16 this month, adding the Bora at #6, Jetta at #10, Magotan at #12 and Tiguan at #16. The Great Wall Haval H6 reclaims the title of best-selling Chinese model at #14 with 15,673 sales (+43%) ahead of the Emgrand EC7 at #17 (+79%) and the Chery QQ at #35 (-16%). Notice also the Kia K3 up 7 spots on April to #25, the Nissan Qashqai up 16 to #30, Audi Q5 up 14 to #38, Roewe 350 up 21 to #44 and the Ford Ecosport up 4 to #67.

Haima M3 sales are up 73% on April.

Among recent launches, notice the Peugeot 3008 up 16 ranks to a best-ever #83, the ChangAn Ouliwei up 30 to break into the Top 100 for the first time at #84, the Citroen C4L up 65 to #100, Audi Q3 down one to #108, Haima M3 up 46 to #121, FAW Besturn X80 up 43 to #141, BYD Sirui up 61 to #188 and the ChangAn Raeton up 57 ranks to #190. We welcome 5 new models in the ranking this month, but these will be the subject of a special (and new) monthly post focusing on the all-new models…

Previous post: China: Light-vehicle market to reach 30 million units by 2020

Previous month: China April 2013: Honda CR-V up to #4, Nissan Teana takes off

One year ago: China May 2012: Chevrolet Sail leads the way, Ford Focus #2

Full May 2013 Top 304 All-models Ranking Table below.

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That’s a lot more BYD cars on the roads…

* See the Full article by clicking on the title! *

As I detailed in my articles China: return to explosive growth expected and China: How local brands may finally find their mojo at home, sales growth is here to stay in China and will mainly come from the less developed regions of the country located in the hinterland. So I thought it was time to learn a little more about these regions where the bulk of new vehicles will be bought over the next decade. Autonews says China’s light-vehicle market will reach 30 million units in 2020, up from 19.1 million last year and larger than the 2012 US and European markets combined!

Province capitals and municipalities in China

Autonews adds that by 2020, western China’s share of total sales is expected to rise to 26%, up from 18% in 2011, according to predictions from IHS Automotive. The coastal region’s market share will drop from 60% to 43%. So we are not looking at a complete shift, but this evolution seems irreversible. And this is where I need to introduce you to the concept of Tier cities. In China, cities of over 1 million inhabitants have been classified into 4 Tiers based on their population and wealth. There are no strict definitions but to simplify, see below IHS Automotive’s definitions:

The bulk of the Chinese car market has resided up until now in Tier 1 and 2 cities. As a result, in Tier 1 cities there are 128 vehicles per 1,000 residents. This ratio falls to 54 in Tier 3 cities and 28 in Tier 4 cities. The hinterland market is now seen as ripe…  ”A Tier 3 city today grows into a Tier 2 city tomorrow,” Jeep President Mike Manley told reporters at the Shanghai autoshow. “And real estate becomes increasingly hard to get. So you try to get ahead of the curve.”

New York? No, this is Chongqing, 1,500 km West of Shanghai…

Chongqing, a city of 5 million inhabitants located 1,500 km west of Shanghai, is at the convergence of rail lines and highways in central China and Ford has started the construction of both an engine and a transmission plant there, for which the local government literally removed a small mountain from the landscape…

Volkswagen in building an assembly plant in Urumqi.

Volkswagen already has an assembly plant in the western city of Chengdu, which also is home to a plant run by Toyota and FAW. This year VW will add a plant in Urumqi, 2,500 km west of Beijing but only 500 km Southwest of Mongolia. Soh Weiming, VW China’s executive vice president of sales and marketing, called Tier 3 and 4 cities the automaker’s “bread and butter.”

Full article below.

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The Qoros 3 was unveiled at the Geneva Motor Show last April.

* Click on title for the Full article! This is Part 5 of 5 in a series on Chinese carmakers abroad *

See also Part 1 (Africa), Part 2 (Latin America), Part 3 (Eastern Europe) and Part 4 (Asia).

The first 4 Parts in this series have shown Chinese manufacturers securing the less developed markets in each region as springboards to expand further. Less developed means smaller and less sophisticated but also less regulated as far as pollution and security are concerned. These last two aspects have been the main barrier to the Chinese carmakers’ entrance in mature markets to date, and specific strategies have had to be developed to address this. This is why I am grouping all ‘mature markets’ in one article, independent of their geographic location.

Brilliance BS6. This 2007 crash test put a dent into Chinese carmakers’ plans in Western Europe.

The Chinese have learnt this the hard way back in 2007 when disastrous crash tests for the Brilliance BS6 and Landwind SUV meant these two carmakers and all other Chinese manufacturers that were seriously thinking about setting shop in these regions had to postpone their plans. 6 years later, manufacturing quality has improved and there are a few mature markets where the Chinese have started to make their mark, among them Australia, Italy and the UK. The launch of the new Qoros brand by Chery at the Geneva Auto Show earlier this year is another important milestone even though European sales of the brand will remain limited.

The Great Wall V-Series is the first Chinese model to break into the Australian Top 50

The main success story so far for a Chinese manufacturer in a mature market is Great Wall in Australia. You can see the full details in my article Australia: An interview with Daniel Cotterill from Great Wall. Great Wall launched there in 2009 and finished 2012 as #17 brand with sales up 27% to 11,006 units and 1% share, totalling over 30,000 to-date. Even though these figures seem small, it is actually one of the most successful car brand launches in the country in the past decade, as the market is already completely saturated with over 50 brands present, way more than in the US which is 14 times bigger…The Great Wall V-Series pick-up (aka Steed) is the first Chinese model to break into the Australian Top 50, finishing 2012 at #49 with 7,490 sales, up 35%.

One of the key factors in Great Wall’s success in Australia has been to embrace the brand’s provenance rather than hiding it. Both their slogan ‘The Great cars of China’ and strong positioning on price are unapologetic. The main element to remember here is that by focusing on sturdy workhorses, Great Wall is building itself a solid reputation of reliability under the harsh Australian climate which is at polar opposites with the likes of Hyundai when they first launched there, as evidenced by the healthy amount of repeat business the brand is already experiencing. Chery, Geely and Foton are also present in Australia but not successful at this stage.

The Riich M1 is assembled and sold in Italy as the DR1

Italy is the only mature market to assemble Chinese models. Chery cars are assembled by the DR Motor Company since 2007 in Macchia d’Isternia, North of Naples. The range is composed of the DR1 (Riich M1), DR2 (Chery Kimo) and DR5 (Chery Tiggo) however sales dropped 76% from 2,938 in 2011 to just 710 in 2012.

The Great Wall Hover ranked #32 in Italy in December 2011. More of a freak event though.

Great Wall also imports in Italy which became the first Western European country to welcome a Chinese model within its monthly Top 50 in December 2011 when the Great Wall Hover ranked #32. This was a freak event though as it seems Great Wall sold all their stock that month to dealerships but continued to sell to consumers all through 2012 even though official sales figures were down from 1,675 in 2011 to just 10 (!) in 2012.

The MG6 has disappointed in the UK so far.

The UK is the third mature market where the Chinese are gaining valuable experience. MG, now owned by SAIC, was reintroduced there in 2011 with the MG6 albeit with disappointing results: the model ranked only #203 with 772 sales for its first full year in 2012 and is down 82% over the first Quarter of 2013. Inspired by its Australian success, Great Wall soft-launched there in 2012 with the Steed pick-up and finished the year as #15 LCV brand with 476 sales and 0.2% share, and selling 226 units so far in 2013. Very small numbers still but the footprint is there.

Shanghai Englon TX4

Another angle Chinese manufacturers are starting to pursue is the delivery of electric public transport to big metropolitan cities. BYD is set to deliver 50 of its electric hatchback e6 to operate as London taxis while the first batch of 45 e6 has now arrived in Hong Kong, and will start manufacturing electric buses in California later this year. But the biggest development in that area happened last February when Geely acquired iconic London Taxi maker Manganese Bronze. Geely was already manufacturing and selling the London Taxi in China as the Shanghai Englon TX4 and is now looking into developing an electric version.

See the full article featuring the all-new brand Qoros below.

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The Wuling Hongguang launched this month in India as the Chevrolet Enjoy.

* Click on title for the Full article! This is Part 4 of 5 in a 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 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.

The 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 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.

ChangHe 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…

Full article featuring Thailand, Indonesia, Malaysia, Iran and the Philippines below.

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

* Click on title for the Full article! This is Part 3 of 5 in a 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.

The 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).

The 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.

The 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.

Chery 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.

Bulgarian 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…

Full article featuring the rest of Eastern Europe including Belarus, Serbia, Bosnia and Kosovo below.

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Wuling 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.

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Like this fennec fox, Chinese carmakers have been walking against the wind in Africa. And it’s worked.

* Click on title for the Full article! This is Part 1 of 5 in a 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 have 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 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…

The 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 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.

The 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 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 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…

Full Article below.

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China became the largest automotive market in the world in 2009 while the US fell into recession. However since then, Chinese sales slowed from the strong double-digit growth of 2009 and 2010. This slowdown is about to be over, according to Ryan Cui, an analyst with LMC Automotive, who told China Daily passenger vehicle sales will rebound to 10.5% growth this year and a stable increase will continue in the next 4 to 5 years. Even more telling, LMC doesn’t foresee any chance of a decline, which is confirmed by Lin Huaibin from IHS Automotive who said that a falling market “is impossible” unless the nation’s economic fundamentals change.

Volkswagen unveiled the Cross Blue Coupe at the Shanghai Motor Show this year…

There are two explanations for this return to explosive growth.

First, even after a decade of extremely strong sales, still only about 67 of every 1,000 people in China now have a car. This is to be compared to 600 cars per thousand people in many European countries and 800 per thousand in America. According to Bertel Schmidt from The Truth About Cars, China’s car growth is directly connected to the economy and most car sales still are in cash, so Chinese consumers tend to save when darker clouds appear on the economic horizon. As business picks up in China, car sales should follow.

…while Ford unveiled the Escort concept at the same Show.

Second, the main foreign manufacturers present in China are ramping up production at unprecedented levels, adding over 3 million annual vehicles over the next 2 to 3 years! For example, by 2015 Volkswagen will have no less than 12 vehicle plants in China and Ford will have doubled its annual capacity to 1.2 million… See the detail by manufacturer below.

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