Global automakers may be in for a rude awakening if they believe they can extend their supremacy in China into the electric future.
General Motors and Volkswagen, the titans of the combustion engine age, are falling behind local players in China's expanding electric vehicle (EV) market, a country that is critical to funding and developing their electric and autonomous goals.
Electric car sales are soaring in China's roughly $500 billion auto sector, which is the world's largest.
According to data from the China Association of Automobile Manufacturers, the number of new energy passenger cars - pure EVs and plug-in hybrids - more than doubled from a year ago to 1.49 million automobiles in the first four months of 2022.
Cleaner technologies accounted for 23 per cent of China's passenger car market, despite a 12 per cent drop in overall vehicle sales, owing to a sharp drop in demand for gasoline cars.
According to data from the China Passenger Car Association, there are no foreign brands among the top 10 automakers in the new energy vehicle (NEV) market this year, with the significant exception of U.S. electric pioneer Tesla in third position.
From BYD and Wuling to Chery and Xpeng, the remainder are Chinese brands. BYD, China's market leader, has sold about 390,000 electric vehicles in the country this year, more than three times the number sold by worldwide leader Tesla. In terms of EV sales, the top-ranked traditional carmaker is Volkswagen's joint venture with FAW Group, which is placed 15th.
Cheng claimed that foreign brands, such as Buick's Velite 7 and Volkswagen's ID. series, failed to deliver what she was hoping for: an EV that could provide her with the "comfort" of a smartphone-like experience in her car.
"Foreign brands are so far from my life and lifestyle," said Cheng, whose digital assistant handles connections to apps like Alipay and Taobao and "does everything for me from opening the windows to turning on music", while her car software provides over-the-air updates.
It's a complete 180-degree turn. Since the 1990s, global brands have dominated in China, with a combined 60-70 per cent share of passenger car sales in recent years. They took 52 per cent in the first four months of 2022, with a monthly share of 43 per cent in April.
Nissan CEO Makoto Uchida told Reuters that some brands "may perish in three to five years" in China, indicating the magnitude of the problem facing established manufacturers.
"Local brands are becoming stronger," said Uchida, who was formerly Nissan's China chief, adding that the quality of EVs from Chinese makers had improved rapidly, with advances being made in the space of months.
"There will be a lot of transformation in China and we need to carefully watch the situation," said the CEO, adding that carmakers had to be nimble in the design, development and launch of new models.
"In those aspects, if we were slow, we would be left behind."
Bill Russo, a former Chrysler executive who now runs the Shanghai-based consultancy Automobility, believes global brands must act quickly because they control less than 20 percent of China's only growing vehicle industry.
"Chinese brands are wining the race to EV," said Russo, adding that consumers' shift to cars that are essentially smartphones on four wheels appeared irreversible and that traditional carmakers were having trouble keeping up.
"I think it's a secular shift toward hi-tech," he said of the consumer demand for a "user-centric digital services experience" with a focus on interface, connectivity and apps.
(Source:www.reuters.com)
General Motors and Volkswagen, the titans of the combustion engine age, are falling behind local players in China's expanding electric vehicle (EV) market, a country that is critical to funding and developing their electric and autonomous goals.
Electric car sales are soaring in China's roughly $500 billion auto sector, which is the world's largest.
According to data from the China Association of Automobile Manufacturers, the number of new energy passenger cars - pure EVs and plug-in hybrids - more than doubled from a year ago to 1.49 million automobiles in the first four months of 2022.
Cleaner technologies accounted for 23 per cent of China's passenger car market, despite a 12 per cent drop in overall vehicle sales, owing to a sharp drop in demand for gasoline cars.
According to data from the China Passenger Car Association, there are no foreign brands among the top 10 automakers in the new energy vehicle (NEV) market this year, with the significant exception of U.S. electric pioneer Tesla in third position.
From BYD and Wuling to Chery and Xpeng, the remainder are Chinese brands. BYD, China's market leader, has sold about 390,000 electric vehicles in the country this year, more than three times the number sold by worldwide leader Tesla. In terms of EV sales, the top-ranked traditional carmaker is Volkswagen's joint venture with FAW Group, which is placed 15th.
Cheng claimed that foreign brands, such as Buick's Velite 7 and Volkswagen's ID. series, failed to deliver what she was hoping for: an EV that could provide her with the "comfort" of a smartphone-like experience in her car.
"Foreign brands are so far from my life and lifestyle," said Cheng, whose digital assistant handles connections to apps like Alipay and Taobao and "does everything for me from opening the windows to turning on music", while her car software provides over-the-air updates.
It's a complete 180-degree turn. Since the 1990s, global brands have dominated in China, with a combined 60-70 per cent share of passenger car sales in recent years. They took 52 per cent in the first four months of 2022, with a monthly share of 43 per cent in April.
Nissan CEO Makoto Uchida told Reuters that some brands "may perish in three to five years" in China, indicating the magnitude of the problem facing established manufacturers.
"Local brands are becoming stronger," said Uchida, who was formerly Nissan's China chief, adding that the quality of EVs from Chinese makers had improved rapidly, with advances being made in the space of months.
"There will be a lot of transformation in China and we need to carefully watch the situation," said the CEO, adding that carmakers had to be nimble in the design, development and launch of new models.
"In those aspects, if we were slow, we would be left behind."
Bill Russo, a former Chrysler executive who now runs the Shanghai-based consultancy Automobility, believes global brands must act quickly because they control less than 20 percent of China's only growing vehicle industry.
"Chinese brands are wining the race to EV," said Russo, adding that consumers' shift to cars that are essentially smartphones on four wheels appeared irreversible and that traditional carmakers were having trouble keeping up.
"I think it's a secular shift toward hi-tech," he said of the consumer demand for a "user-centric digital services experience" with a focus on interface, connectivity and apps.
(Source:www.reuters.com)
