Western and Chinese carmakers in China: a new paradigm III. Non-Chinese premium carmakers resist in China
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Western and Chinese carmakers in China: a new paradigm III. Non-Chinese premium carmakers resist in China
- Unlike non-Chinese mainstream carmakers who have seen their sales declining on the Chinese market in recent years, German Premium carmakers not only resist but progress continuously since their arrival on the Chinese market in the early 2000s. Most of their models are now produced in China, as imports have become increasingly rare. Only the most expensive models still come from Germany or the United States.
- The image of these brands certainly plays a big role in their success on the Chinese market. In 2023, Audi sold 670,000 cars in China compared to 510,000 in 2015. Mercedes sold 690,000 cars in China compared to 255,000 in 2015. BMW sold 745,000 cars in China compared to 287,000 in 2015. These figures show spectacular progress results that are only found among independent Chinese carmakers, although with more modest volumes. The market share of Audi, Mercedes, BMW in China increased from 4.7% in 2017 to 7.3% in 2023.
- The future of German Premium carmakers is, however, not guaranteed in the medium term and even more so in the long term, because Chinese carmakers are increasingly developing Premium models intended for the wealthiest Chinese customers, and the launches of this type of model have been intensified these last two - three years. Often new brands are created to address the premium market. In addition, these brands very often propose battery electric models, which are still underdeveloped among German premium carmakers.
Western and Chinese carmakers in China: a new paradigm II. SAIC and Dongfeng are the big losers in the Chinese automobile industry
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Western and Chinese carmakers in China: a new paradigm II. SAIC and Dongfeng are the big losers in the Chinese automobile industry
- As a direct consequence of the decline of non-Chinese carmakers in China (apart from Toyota and Tesla), the Chinese carmakers in JV which produce the western branded models and which are impacted by the evolving demand of the Chinese customers are seeing their production volume dropping, sometimes in significant proportions.
§ Thus, SAIC, which assembles Volkswagen and some models from the GM group (Chevrolet, Buick, Cadillac, Baojun, Wuling), went from 7 million vehicles produced in 2018 to 5 million in 2023. The Chinese brands of SAIC, such as MG , Roewe or Maxus could not offset the huge losses due to the decline of GM and Volkswagen (3 million units in total).
§ Dongfeng (DFM) was the second biggest loser these recent years, its production volume falling from 3.7 million in 2017 to 2.2 million units, due to declining sales of Kia, Nissan, Honda, Peugeot and Citroën produced in JV.
§ BAIC has seen its production volume plunged by 1.1 million since 2016.
§ Changan remains stable over the entire period.
§ FAW saw its volume increase slightly over the period, benefiting from the increasing sales of Toyota which partly offset the decline of the Volkswagen models it assembles.
- These five large Chinese groups therefore experience diverse situations but they are all threatened today by independent Chinese carmakers, notably BYD and Geely, who have made significant progress in recent years and are approaching their production volume. BYD has exceeded the mark of 3 million vehicles produced in 2023 and Geely has exceeded the 2.7 million units, thus taking the lead over Changan, Dongfeng or BAIC.
Renault add the Trafic to its range of battery electric LUVs
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Renault add the Trafic to its range of battery electric LUVs
- Renault presented the battery electric version of its Trafic, a light utility vehicle (LUV) in the N1-2 segment, which is added to the BEV LUV Renault range made up until now of the Kangoo ZE (N1-1) and Master ZE ( N1-3).
- The range of Renault light utility BEV is now complete and can compete the light utility BEV range of Peugeot, Citroën, Opel and Fiat from the Stellantis group:
1. The Kangoo ZE competes with the Peugeot e-Partner, Citroën e-Berlingo, Opel e-Combo and Fiat e-Doblo.
2. The Trafic ZE competes with the Peugeot e-Expert, Citroën e-Jumpy, Opel e-Vivaro and Fiat e-Scudo.
3. The Master ZE competes with the Peugeot e-Boxer, Citroën e-Jumper, Opel e-Movano and Fiat e-Ducato.
- Models based on the Renault Trafic such as the Nissan Primastar or the Mitsubishi Express should soon receive the same electric motorization as the Renault Trafic, just as the Renault Kangoo clones (Mercedes Citan / T Class and Nissan Townstar) have received the same electric engine.
- Inovev foreacasts that 10% of Renault Master produced in 2030 will be battery electric (compared to 2% in 2023), 20% of Renault Trafic in 2030 (0% in 2023) and between 30 to 35% of Renault Kangoo in 2030 (compared to 15% in 2023).
- In 2023, Renault branded battery electric LUVs will represent around 10,000 units. Inovev forecasts a total volume of more than 60,000 units in 2030.
Western and Chinese carmakers in China: a new paradigm I. The inevitable decline of non-Chinese carmakers in China
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Western and Chinese carmakers in China: a new paradigm I. The inevitable decline of non-Chinese carmakers in China
- Among the ten largest non-Chinese carmakers established in China, only two have managed to make progress on the Chinese market over the past five years: Toyota and Tesla.
- The other eight (Volkswagen, GM, Honda, Nissan, Hyundai-Kia, Ford, Mazda and Stellantis) are inexorably declining, due to strong competition from Chinese carmakers, and from Toyota and Tesla. Some like Mazda or Stellantis are disappearing from the Chinese market, after Suzuki and Mitsubishi which have already disappeared. Volkswagen lost 1 million sales between 2017 and 2023, GM lost 2 million. Honda, Nissan, Hyundai-Kia, Ford have lost several hundred thousand.
- This trend seems inevitable in the future, because the models of Chinese carmakers are becoming more and more competitive, which has allowed them to increase from 40% market share in China in 2015 to 45% in 2021 and 57% in 2023. Their rise is meteoric. The extent of their range which is constantly developing, their technological advance in terms of electric motorization, their design which has made enormous progress and is today more modern than the non-Chinese cars stuck in their tradition, all together in a market with a fierce competition on prices. All these factors have enabled a vast transfer of Chinese customers towards Chinese models.
- It will be very difficult for non-Chinese carmakers to regain lost market shares. Toyota and Tesla remain exceptions. Certainly, Tesla's position does not seem to be compromised in the short term, but for Toyota, it will be more delicate because this carmaker does not propose mass volume electric models sold at a large scale and already the decline seems to have started in 2023.
New Renault 5 E-Tech: 400,000 vehicles/year or 100,000 vehicles/year in Europe?
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New Renault 5 E-Tech: 400,000 vehicles/year or 100,000 vehicles/year in Europe?
- Renault presented the new R5 E-Tech (BEV sedan of the B segment) at the 2024 Geneva Motor Show. The essential question that arises is:
§ Will this new R5 be able to position itself as a mass vehicle, as the old R5s were: rates of 400,000 units per year reached for the R5 (1972-1984), then the Super 5 (1984-1996), and the Clio (rate of 400,000 units per year during its best years)?
§ Or will its volumes be around 100,000 vehicles per year, like those planned for the Zoé when it was launched (in fact this model sold 40,000 units per year on average)?
- At first glance, due to its engine and its price, the new R5 E-Tech does not directly replace the Renault Clio, a B segment sedan with a thermal or full-hybrid engine (HEV). Rather, it replaces the Renault Zoé, a BEV sedan from the B-segment with production stopping at the end of March 2024, but with greater ambitions thanks to a design inspired by the old Renault 5 launched in 1972. In fact, the replacement of the Renault Clio will be launched in 2026. It will receive thermal and full-hybrid (HEV) engines like today.
- Given that the Renault 5 E-Tech will be significantly more expensive than the Clio, it doesn’t target the same market. Inovev is therefore forecasting 100,000 sales in 2030 of this new model BEV, which marks a clear progress compared to the Zoé. It could reach 200,000 sales per year between 2030 and 2035. If it reached 400,000 vehicles per year, the volume recorded by the R5 and Clio during their best years, this should not be before 2035. It should be noted that the Inovev's forecasts for zero-emission vehicles in 2035 do not reach 100% of the market, as required by the EU regulation (Inovev analysis to come).
- Compared to the original Renault 5, the Renault 5 E-Tech is 42 cm longer (3.92 m instead of 3.50 m) and is much heavier (1,350 kg to 1,450 kg depending on the version, compared to 800 kg to 850 kg for the old R5). Based on the AmpR Small platform (ex-CMF-B EV), it will be produced at the Douai plant, alongside the Mégane E-Tech and Scénic E-Tech. Its electric motor delivers 95 hp (70 kW) with a 40 kWh battery, 120 hp (90 kW) with a 40 kWh battery and 150 hp (110 kW) with a 52 kWh battery. The 40 kWh battery allows a range of 300 km and the 52 kWh battery allows a range of 400 km.
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