China August 2017 – Focus on the All-new models

Haval M6

As is the BSCB tradition, we put a laser focus on the new locally-produced launches in China, the world’s fastest-evolving market, so you can on the bleeding edge on the latest additions. After a shy July that saw only three introduction, the August 2017 class is rich with seven new China-made nameplates, six of them Chinese – demonstrating once again the dynamism of the local manufacturers – and six of them SUVs, confirming this is well and truly the only segment on fire in China currently.

1. Haval M6: 3.201 sales

China’s SUV king Haval inaugurates a new naming nomenclature with this M6, however this is in fact a sporty-looking version of the previous generation H6 which is still on sale in China. It is priced similarly to it at 89.800-109.800 yuan (US$13.500-16.500) vs. 88.800-118.600 for the previous gen H6 but logically priced below the current gen H6 (101.800-140.800). Being derived from China’s best-selling  SUV, the M6 competes right into the most crowded segment in the country with the likes of the GAC Trumpchi GS4, Geely Boyue and Changan CS75 all the while undercutting them all in price. Although it seems like overkill at this stage (the H6 also has a Coupe variant plus each model has both red and blue label versions), Haval seems to have thought there is yet another niche of the market they can fill with the M6. The new nameplate’s start seems to give them reason, already positioning the M6 as Haval’s third best-selling model in August below only the H6 and H2 but above the H7, H9, H5, H8 and H1 in this order. Haval is in great need of new blood in its range as it has seen sales drop 13% this month, so the M6 comes at the right time. As long as it doesn’t end up cannibalising H6 sales (down 5% in August), this could end up being a good operation for Haval, as counter-intuitive as it first looks.

Bar for success: 8.000 monthly sales

2. GAC Trumpchi GS3: 842 sales

Unveiled at the Chengdu Auto Show in August, the GAC Trumpchi GS3 already makes its first appearance in the Chinese sales charts on the same month. GAC Trumpchi seems to do no wrong with its SUV range. The tremendously successful GS4 has already sold almost 700.000 units since its launch in May 2015 and its honeymoon period still hasn’t ended will sales up another 15% so far in 2017, ranking 6th overall and #2 SUV below the Haval H6. The much larger GS8 has also hit the bullseye with just under 75.000 sales in just ten months. Only the GS7, a 5-seat variant of the GS8, is struggling so far.

GAC Trumpchi GS3 interior. Picture autohome.com.cn

In this context, the all-new GS3 seems destined to a stellar career. It is reasonably priced at 73.800-116.800 yuan (US$14.200-22.400) and competes (in size) with the likes of the – much cheaper – Baojun 510, but also the MG GS and ZS, Soueast DX3 and Changan CS55. The polished, leather-clad interior impresses, with a large 10 inch touch screen, and the engines available are a 137hp 1.3 turbo and the 114hp 1.5. Similarly to the GS8, GAC Trumpchi should be aiming at 10.000 monthly sales to declare the GS3 a success, but it could go much higher.

Bar for success: 10.000 monthly sales

3. Cowin X5: 692 sales

Cowin, formerly a Chery sub-brand, was launched as a stand-alone brand in August 2014 and premiered at the Chengdu Auto Show in September of that year, however only started appearing in Chinese sales charts in July 2016. Currently the C3 sedan and C3R hatch, V3 MPV and X3 SUV compose the lineup. But the new brand is already starting to puff, with sales down 65% year-on-year in August. This new entrant is no good news for the Cowin brand: the X5 is none other than the previous generation Chery Tiggo 5. This seems to indicate Chery is already starting to give up on the Cowin trial by only feeding it outdated models. The X5 concept car was alluring and let us imagine a brand new SUV. Not so. In fact, only the badge has been changed from Chery to Cowin as this is 100% from the inside out a 2013 Chery Tiggo 5. The 152hp 1.5 turbo engine has also been kept.

Logically, the X5 is priced below the Tiggo 5 but only by 10-15%: from 79.900 to 104.900 yuan (US$12.000-15.800) vs. 88.800-123.800 for the Tiggo 5. The X5 now competes with lower-end SUVs such as the Dongfeng Joyear SUV X5 and the Geely Vision SUV but ironically, local outlet Autohome also pits it against the Chery Tiggo 5 and 7, seemingly acknowledging the potential cannibalisation that the Cowin X5 may trigger. The fact that Tiggo 5 sales freefall 85% this month to just 770 isn’t good news either, even if it is seemingly awaiting the new generation to kick in. In terms of Cowin sales precedents, the C3 peaked at 1.205 units in July 2016, the V3 at 2.045 in October 2016 and the X3 at 4.431 in October 2016 also, and all these designs were new so it would be unreasonable to expect the same level of success for the X5. On the other hand if the X5 is as or more successful than the aforementioned nameplates, it could mean Cowin becoming an unglorified low-cost hand-me-down of Chery with no design differentiation.

Bar for success: 3.000 monthly sales

4. Baojun E100: 674 sales

Baojun is an extremely successful brand manufactured by the SAIC-GM-Wuling joint-venture, owned at 44% by General Motors. Thanks to the exceptional success of the 510 SUV and 310 hatch, added to the 560 SUV and 730 MPV, the brand is up 84% in August and 34% so far in 2017 with just under 550.000 sales. The E100 is Baojun’s first electric vehicle, and if it behaves the same as the manufacturer’s latest launches, it should smash records for this segment in China. But the EV sphere has been quite opaque in the country since its inception, with wide reports of exaggerated sales in order to illegally benefit from the government subsidies. EV is still the far-west of China, but sales are definitely on the up. Plus the Chinese government is currently mulling a date for the ban of sales of petrol vehicles. So EVs are here to stay.

Baojun E100 interior. Picture autohome.com.cn

Baojun has pushed the envelope for the E100 whose interior is particularly cool for a Chinese vehicle. Tiny, at 2.49m, it has a 39hp electric motor, can go to up to 100 km/h and has a 155km range. Originally priced between 93.900 and 109.900 yuan (US$14.100-16.600), these rates drop to a very affordable 35.300-48.200 yuan (US$5.300-7.300) once green-car subsidies have been factored in. The E100 competes with other mini EVs such as the Zotye E30 (max: 2.044 monthly sales), Zhi Dou D2 (peak at 5.018 sales this month), Zotye E200 (3.500) and Chery eQ1 (1.660). Applying a Baojun filter to these best performances – i.e. smashing them – may not be quite adequate yet but the market does expect a frank success from the E100.

Bar for success: 3.500 monthly sales

5. Geely Vision X3: 363 sales

Three months after the Vision X1 which was in fact a facelifted Panda, Geely launches yet another crossover with the Vision X3, based this time on the Geely England SC5-RV and keeping its 1.5 engine. The X3 adds also to the Vision sedan, facelifted this year, and the Vision SUV, a smashing success. It would appear that after deleting its Englon and Gleagle brand a few years ago, Geely now cannot help but building sub-brand families: the Emgrand EC7, GS and GL and this fourth Vision nameplate… The Vision X1 is 3.78m long and is priced between 39.900 and 57.900 yuan (US$ 6.000-8.700), the X3 is 4.01m long and also priced very competitively at 50.900-65.900 yuan (US$ 7.700-9.900), all the while sporting an interior design that we have found in much dearer Geelys.

Geely Vision X3 interior. Picture autohome.com.cn 

Apart from the Baojun 510 (170.000 sales in seven months), few have managed to crack the small crossover segment in China. The Vision X3 will also compete with the likes of the Chery Tiggo 3X, Changan CS15, Haval H1 and JAC S2. For reference, after four months in market the Geely Vision X1 has only managed to crack the 3.000 monthly sales barrier, meanwhile Geely’s larger SUVs such as the Boyue (21.872), Emgrand GS (12.953) and Vision SUV (10.942) fare a lot better. In this context, doubling the current X1’s personal best would be a step in the right direction for the X3 and position it halfway towards its larger siblings’ volumes.

Bar for success: 6.000 monthly sales

6. Isuzu MU-X: 359 sales

Japanese car and truck maker Isuzu is engaged in two joint-ventures in China: one with Qingling Motors that produces trucks, and one with Jiangling Motors Co. Group (JMCG) which until now has produced pickup trucks. Based in Nanchang in the Jiangxi province, this joint-venture is called Jiangxi Isuzu Motors. Its first China-made vehicle was the Isuzu D-Max launched in December 2014 (starting at 114.000 yuan (US$17.200), and it later launched a cheaper variant called the Ruimai starting at 84.800 yuan (US$12.800) but sporting a different logo. You can find their sales evolution in our dedicated monthly China LCV articles. Logically, now comes the D-Max-based MU-X SUV, originally launched in November 2013 in Thailand and finally reaching Chinese shores as a local production. Priced between 178.800 and 268.800 yuan (US$ 26.900-40.500), it is offering a rugged and very capable alternative to the Mitsubishi Outlander, Toyota RAV4, Honda CR-V and Mazda CX-5, all priced similarly but smaller. The Haval H9, Changan CS95, GAC Trumpchi GS8 and Maxus D90 (see below) would compete with the MU-X as far as Chinese manufacturers are concerned. The Jiangxi Isuzu Ruimai is up 106% to 10.623 sales after 8 months this year while the D-Max is up 46% to 5.651. In this context we think a stretch target of 1.000 units/month should be applied for the MU-X.

Bar for success: 1.000 monthly sales

7. Maxus D90: 83 sales

The last novelty for August – but definitely not the least impressive – is the imposing Maxus D90 SUV. After two vans, the V80 (September 2011) and G10 (May 2014), and one pickup, the T60 (November 2016), Maxus launches its first SUV, the D90. Maxus is owned by SAIC who bought the brand from the British LDV Group in 2010. The D90 is one of the largest Chinese SUVs in market at 5.01m long. It’s an AWD powered by a 221hp 2.0 turbo mated with a 6-speed auto gearbox. Priced very attractively at 156.700-263.800 yuan (US$23.600-39.700), it undercuts all its rivals: the Haval H9 starting at 199.800 yuan, the GAC Trumpchi GS8 starting at 163.800 and even the Changan CS95 starting at 159.800. Maxus will also try to convince foreign SUV buyers that would have otherwise looked at a Toyota Highlander (239.800 yuan start), VW Terramont (308.900 start) or Toyota Prado (369.800 start), all these models being extremely successful already.

Maxus D90 interior. Picture autohome.com.cn 

Traditionally, Chinese manufacturers have struggled to impose themselves in the full-size SUV segment. Only the GAC Trumpchi GS8 has managed to crack the mould with two five-digit sales months and a personal best of 10.032 units last March. Maxus’ low brand awareness in the passenger car segment won’t help, but the vehicle is striking in design and has all the required luxuries inside to satisfy its target clientele. The G10 van hit a personal best of 2.815 sales last March, while the T60 Pickup hasn’t managed to crack the 1.000 monthly sales yet with 882 units last April being its best so far. In this context, reaching 2.000 units would be a gage of success for the D90.

Bar for success: 2.000 monthly sales

Previous month: China July 2017: Focus on the All-new models

One year ago: China August 2016: Focus on the All-new models

Current China data: China August 2017: Chinese SUVs near 60% segment share, market up 4.1%