China May 2015: Focus on the all-new models

The GAC Trumpchi GS4 starts with a bang at #80 in China.

It’s now time to go into the detail of the all-new models landing into the largest new vehicle market in the world: China. As always this only concerns the models that have kick-started local production as imports data is still very patchy for China. After welcoming 6 new entrants both in March and April, we have 5 new nameplates in May, however 3 of them are already either inside or within throwing distance of the Top 100. No surprise here: they are all SUVs.

1. GAC Trumpchi GS4 (#80 with 6.451 sales)

GAC and particularly its Trumpchi sub-brand (brand?) is one of the most dynamic Chinese manufacturers of the moment, achieving rather satisfying designs of late. The GS4, unveiled at Detroit in January, is a prime example and has even been singled out by GAC as the company’s first nameplate to be introduced in the U.S. market, with a launched date aimed at 2017. For now it has hit its domestic market with a bang, landing directly at #80 with 6.451 sales in May. That’s already 60% of all Trumpchi sales in China this month! In comparison, the only other Trumpchi SUV, the GS5, landed at #200 for its fist month of sales in April 2012 and reached all-time bests of 9.406 sales in December 2014 and #56 in Dec 2013 – scores within reach for the GS4. It is now down 69% with the arrival of the smaller, cheaper and more modern GS4, sharply priced between 99.800 and 146.800 yuan (US$16.100-23.600). The GS4 could be the nameplate to take the Trumpchi brand to the next level, with the only other model to reach similar sales levels so far being the GA3S at a personal best of #73 and 8.585 sales last December. If the GS4 had started lower, I would have placed its bar for success around the level it has achieved this month, so let’s give it a stretch target.

Bar for success: #50 or 10.000 monthly sales

2. Brilliance V3 (#114 with 4.297 units)

The Brilliance V3 is the second all-new model for May that is completely reshaping its brand’s sales landscape in China. Making its entrance directly at #114 with 4.297 sales, it is not only Brilliance’s best-seller as early as for its first month in market, but it also manages to already represent 43% of the manufacturer’s total sales at home, lifting the SUV share in Brilliance sales to a whopping 73% (7.312 out of 10.055). This trend is set to accelerate with the V3 reaching cruising sales levels. As I described in my coverage of Auto Shanghai, Lifan, another domestic manufacturer struggling in the sedan segment, is taking a leaf out of Brilliance’s book by launching 3 SUVs in the space of a few months. Interestingly, the launch of the V3 has not affected sales of the larger and older V5 in any way: it is up 92% year-on-year in May to 3.015 deliveries. The V3 is very competitively priced from 65.700 to 102.700 yuan (US$10.600-16.500) and is aiming as such blockbusters as the Haval H1, JAC Refine S3 and ChangAn CS35. First signs are these other affordable small domestic SUVs  are pulling the Brilliance V3 up in their wake rather than obliterating it. The SUV segment still has very long legs in China.

Bar for success: #75 or 8.000 monthly sales

3. Ford Edge (#119 with 3.848 deliveries)

One of only two foreign new entrants this month in China, the Ford Edge is the first rocket launched by Ford this year in its plan to ramp up its SUV presence in China in order to benefit as much as possible from the current SUV craze affecting Chinese car buyers. Priced between 249.800 and 429.800 yuan (US$40.200 – 69.200), the seven seat Edge will be followed by an all-new Everest produced in Nanchang, Jiangxi from this July onwards and on sale in October. And the Edge’s first month of sales is great news for Ford: despite being priced markedly higher than both the 94.800-127.800 yuan Ecosport and the 193.800-275.800 yuan Kuga, it manages to land just below the former (#117, -45%) and at around 40% of the sales of the latter (#54, -15%), however both the Ecosport and the Kiga lose ground year-on-year this month, hinting at a possible partial cannibalisation.

Bar for success: #70 or 8.000 monthly sales

4. Beijing Auto Senova CC (#253 with 657 sales)

The aggressive-looking Beijing Auto Senova CC is the performance variant of the Senova D60, with the underpinnings of the Saab 9-3 Aero. Aggressively priced between 99.800 and 149.800 yuan (US$16.100-24.100), the Senova CC is powered by either a turbo 1.8L or turbo 2.0L engine. Although launched last September, the Senova D60 bizarrely still hasn’t appeared in the Chinese ranking. In any case, sales pretensions are rather modest for this model. The best-seller in the Senova range is currently the D50 which peaked at an astounding #54 in March but is down to #177 in May, #98 year-to-date. The D20 sedan ranks at #159 in 2014, the X65 SUV is #202 and the D70 sedan is #328.

Bar for success: #175 or 2.000 monthly sales

5. VW Gran Santana (#307 with 155 units)

Following the tremendous success of the Gran Lavida, Shanghai-Volkswagen is taking the plunge into the hatchback world with the Gran Santana, priced between 96.900 and 138.900 yuan (US$15.600-22.400), a 14% premium on the sedan. So far this year, the Gran Lavida accounts for 22% of Lavida sales, with a peak at 25% this month – effectively enabling the Lavida into the overall pole position. Potentially in anticipation of the Gran Santana launch, Santana sales are down a harsh 33% in May to 19.146 units with year-to-date sales stable at 133.625. Applying roughly the same market share the Gran Lavida has reached vs. the Lavida gives us an average of just under 5.000 monthly sales for the Gran Santana. Anything bigger will prompt Volkswagen to rethink the prority they give to sedans in China and will trigger the launch of a Gran Jetta and Gran Bora, equivalents of the Gran Santana and Gran Lavida but this time through the 2nd Volkswagen joint venture in China: with FAW.

Bar for success: #100 or 5.000 monthly sales

Previous month: China April 2015: Focus on the all-new models

One year ago: China May 2014: Focus on the all-new models

Overall May 2015 post: China April 2015: Wuling Hongguang, VW Group tumble in slow market