new car market in china 2016

Posted on 4/26/2016 4:11:50 PM

Some foreign media reported that the wily Toyota has been restrained their investments in China, and the excessive reliance on the Chinese market, GM and Volkswagen, in the past two years generous in capacity expansion, or under the influence of future market slow growth, suffered no small overcapacity crisis.
Senior analyst at the automotive market Zhang Zhiyong Die Zeit, told reporters that "excess capacity" has been an old problem in the automotive industry, but also a structural problem, can not go to the hook from the overall capacity supply and demand situation and one enterprise supply and demand situation, any business in accordance with supply and demand are big the market, combined with their ability to enhance the competitiveness of enterprises can determine the capacity planning.
"New normal" highlights the hidden capacity
Although Toyota still dominating the throne of the world, but in the Chinese market, GM and Volkswagen is the protagonist here. With the growing competition in the Chinese auto market, GM and Volkswagen in recent years, the competition has already risen to a new stage.
2015 China auto market downturn, the market just need to drop and overcapacity as the main reason. In China's economic growth slowed in the background, in 2015 the Chinese auto market experienced unprecedented cold.
These multinational companies make overly optimistic embarrassing is that in 2015 China's automobile market has stagnated in terms of volume growth. According to China Association of Automobile Manufacturers say, in 2015 annual sales of China's auto market is 24,598,000, an increase of only 4.7%. The contrast is a public cross-car prices in China's energy production but still double-digit growth, which in China as the main market of GM and VW's capacity expansion is particularly evident.
The end of 2014, all Volkswagen Group brands in China has formed a capacity of 3 million, according to the prevailing situation, the Volkswagen Group is planning to post-2019 will be in China production capacity to 5 million, increase over 2014 60 % or more; while GM and its brand in China in 2014 capacity of 3.54 million, which was planned by the year 2015 this figure raised to 5 million, as early as 5 years to achieve full production capacity of 5 million more than the public, However, according to strategy 2020 GM previously raised its 2020 production capacity will increase 65%.
The reality is that GM and its Chinese joint venture in 2015 reached a record 3.6126 million car sales in the Chinese market, an increase of 5.2 percent over the previous year; and Volkswagen China sales last year fell 3.4% to 3.55 million. Two giants out of the opposite of the performance, but it is by virtue of the common SGMW Baojun brand and outstanding performance, only to achieve a contrarian growth. In its original 2015 2014, we had expected to achieve 5 million production capacity in China.
The government introduced 1.6L purchase tax policy stimulus, the Chinese automobile market in 2015 was able to save a little face in the world market. Thus, the foreign media commented that the Chinese auto market volatility makes both rely mainly on Chinese game market worldwide for multinational expansion of production capacity has been adjusted.
Zhang Zhiyong regard to the Weekly Times correspondent said that sometimes we will determine the production of all enterprises can add up to more than the market expected demand, but one specific enterprise, if its product is very strong, very good market prospects, then then it is more likely to occur in short supply.
Universal Chinese market
China has always been GM's biggest market. 2015 GM total global sales of more than a third from the Chinese market.
Although GM timely adjustment of the "5 million in 2015 to achieve production capacity," the idea put forward in 2014, but the general aspects of the Chinese auto market is still showing bullish. In its 2015 release of "Strategy 2020" which, to achieve 5 million production target set at around 2018.
According to the information given by GM China, currently a joint venture of General Motors and has a total of 24 factories in China, by 2017, there will be two plants put into operation. GM China Public Relations of the Weekly Times correspondent said that at present, our production capacity utilization in China is very high. For example, early last year, SAIC-GM of Wuhan plant a production, from the beginning of January to the end of the year, capacity utilization is increasing rapidly. So far, the Wuhan plant has a production capacity fully released. Meanwhile, two factories in Wuhan has started construction last year. We are still in the implementation of a few years ago announced investment plans and capacity development plans.
View of the future growth of the Chinese auto market, GM China Public Relations expressed, China market has important strategic significance for General Motors, GM believes China's auto market will continue to develop, total vehicle sales will rise further .
"By 2020, the total size of China's auto market will increase by 5 million on the existing basis, to achieve annual sales of 30 million, equivalent to an average annual rate of about 3% -5% .2016- 2020, we expect 60 launched several new and modified models in the Chinese market, focus on strengthening the SUV, MPV and luxury car market. "said GM China public relations official said the weekly Times reporter.
In the marketing industry known for General Motors, the digestive capacity, promote sales can often unique way, China's auto market a variety of factors that may arise for the General Motors also put forward their own solution. GM previously announced, the company expects in the summer of 2016, China produced respectively Keangkewei exports to the US market, which is the first multinational companies in the local market, the introduction of "Made in China" in automotive products, the industry has also been interpreted as the future capacity to solve one kind of taste style.
Even General Motors in China to promote the concept of a shared trip to explore the resources of automobile market, although in a sense the move will weaken the market rigid demand for automotive products.
Volkswagen only desperate
Compared with GM can retreat, more than 2015 suffered a crisis of Volkswagen, in the case of China, the sales decline, still choose to gamble in the Chinese market.
Experienced executives inside the Palace of fighting, as well as emissions cheating incident, except for Volkswagen in China, the world's major auto market has notoriously no turning back. 2020 5 million production capacity in China, the target has been a virtual certainty.
Volkswagen China PR Die Zeit, told reporters that, as of now, the Volkswagen Group has 20 production bases and so a total of 30 vehicles and auto parts factories in China. "Our commitment to the Chinese market remains unchanged, stick to our long-term development planning, and have full confidence in China's long-term development."
Although Volkswagen respect for China's auto market to maintain a high degree of confidence, but the relative GM's have sold the main Wuling brand and Baojun brand as a digestive capacity of the main purposes of Volkswagen's production capacity has fallen mainly on the north-south public two opposing pricing above are relatively coincide with the positioning of the enterprise, and therefore Volkswagen actual capacity for digestion more difficult than General Motors.
FAW - Volkswagen Public Relations of the Weekly Times correspondent said the FAW - Volkswagen "Strategy 2020" goals set out in 2020 to reach 3 million in production and marketing capacity, the target is currently in the "Strategy 2020" presented methodically forward.
Industry analysts have Die Zeit, told reporters that under the new car market will still maintain a normal growth, but this growth will be relatively flat, this situation will further test the capacity of those big companies how they can use various means to effectively digest off capacity after layout.
It is difficult to "rely solely on Yaku had to increase sales capacity to digest practices are long gone, emerging from this dealer collective defection event can be discerned, and the general public with a short time to promote new energy strategy give strong support to sales, even though the two giants are optimistic about China's auto, but the ability to achieve balance production and sales, it is still unknown of. "the analyst said.

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