As expected, the Baojun 560 is an instant blockbuster.
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According to the China Association of Automobile Manufacturers, after dropping for the first time in 6 years in June, sales of new light vehicles in China decline for the second straight month in July at -7% to just 1.27 million registrations, the lowest monthly score since February 2014. Thanks to a good start of the year, sales are still up 3% so far in 2015 to 11.36 million. Medium/heavy commercial vehicle sales are unavailable for now. The SUV segment is the only one showing gains with sales up a stunning 41% on July 2014 to 403.091 deliveries. Reversely, sedans freefall 19% to 694.069 units, MPVs are down 8% to 107.807 and microvans down 16% to 74.300. The imploding of the sedan market is unheard of in China as we enter unchartered territory where an affordable SUV offering are becoming vital for a brand’s sales performance in the #1 market in the world.
Are we seeing the end of Volkswagen’s blanket domination of the Chinese market?
The brands ranking is turned upside down with manufacturers displaying completely opposite behaviours. The “big bang” of the month is perennial leader Volkswagen tumbling down 31% to 152,300 sales (imports excluded), pulling its year-to-date total down 10% to 1.52 million units. Heavily reliant on sedans which account for 87% of its total sales in China this month, the German manufacturer pays the price for its weakness in the booming SUV segment, with even its Tiguan down 9% year-on-year. All its star models are falling sharply in July: the Lavida (-16%), Sagitar (-36%), Jetta (-43%), Santana (-42% despite the inclusion of the Gran Santana hatch), Golf (-11%), Bora (-40%), Polo (-50%), Magotan (-44%) and Passat (-49%). In terms of year-on-year sales evolution, Volkswagen has never been in such a fragile position in China, a market it entered 30 years ago.
Honda sales are up 50% year-on-year in China.
Toyota snaps up the 2nd place in the July brands ranking with sales up a splendid 18% to 96.400 units (imports excluded), taking a strong option on retaining the #1 worldwide spot above Volkswagen, while Honda takes off in third place: +86% (without imports) or +50% (incl. imports) thanks to its XR-V and Vezel twin crossovers adding up to 20.289 sales. Nissan is up 3% but down 14% when including imports, Hyundai slips down 32%, Ford is down 19% (-6% incl. imports & Lincoln) and General Motors is down 4% with locally-assembled Chevrolet sales imploding at -44% and Buick at -7%. Notice Peugeot (-27%), Skoda (-27%) and Citroen (-42%) also paying the price for their weakening SUV offerings.
Mercedes bucks the trend and improves its Chinese sales by 42% in July.
Chinese carmakers see varied fortunes: Changan is up 8% to lead the pack at #8 overall, Haval is up 27% to 38.851 units but with its namesake brand down 66%, overall Great Wall sales are down 2%. With the arrival of the 730 MPV and 560 SUV (see further down), Baojun sales are up 11-fold year-on-year (+975%!) to 33.325 whereas Wuling is down 41% to 32.185 not including microvans. Beijing Auto (+125%), JAC (+174%), GAC Trumpchi (+143%) and Brilliance (+39%) are reaping the benefits of model ranges now completely dominated by SUVs. The luxury game is also changing (all figures include imports unlike the raking below the jump): Audi is down 13% to 42.267 deliveries, BMW down 7% to 32.226 but Mercedes surges 42% to 29.540 units thanks partly to the success of the GLA crossover shooting up to #69 and 6.160 sales. This score earns Mercedes the premium pole position worldwide with 149.753 deliveries (+15%), edging past BMW at 147.513 (+6%) with Audi in third place at 146.100 (+1%).
Like in June, the Toyota Corolla is the third best-selling nameplate in China.
In the models ranking, the Wuling Hongguang (-42%) and VW Lavida (-16%) stay on top but drop sharply, while the Toyota Corolla (+53%) rounds up the podium for the 2nd consecutive month. The Haval H6 is up one spot but down 13%, the Baojun 730 up two to #5, the Toyota Vios up 48% to #14, the BMW 5 Series slices its June ranking in two to jump to a spectacular 15th place overall (#9 among sedans!) and the GAC Trumpchi GS4 leaps 28 spots on June to land at #16 with 12.138 deliveries, meaning it is already the #3 SUV in the country behind just the Haval H6 (23.088) and VW Tiguan (17.466). The JAC Refine S3 is up 9 spots to #18, the Geely EC7 up 107% and 12 ranks to #23, the ChangAn CS75 up 111% to #24, Beijing Auto Huansu S3 up 17 to #26 and the Haval H2 up 12 to #36.
Taking the Chinese market by storm: the GAC Trumpchi GS4
As expected, the Baojun 560 SUV is an instant hit with Chinese customers, landing directly inside the Top 50 for its first month of sales at #42 with 9.158 deliveries in July. Among recent launches, apart from the GAC Trumpchi GS4 already a blockbuster, the Brilliance V3 is up 14 spots on June to #64 with 6.751 sales, already accounting for 53% of the brand’s domestic sales this month, the Changfeng Leopaard CS10 is up 44 ranks to break into the Top 100 for the first time at #91, the BYD Qin is up a further 15 spots to do the same at #85 and a record 4.030 sales, the Geely GC9 is up 31 ranks to #113 and 3.200 units, the Buick Verano up 43 to #122 and the BYD Tang up 41 to #231.
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Previous month: China June 2015: First monthly year-on-year decline in over 6 years
One year ago: China July 2014: Market up 10% thanks to MPV and SUV sales
Full July 2015 Top 360 All-local models and Top 60 brands below.