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The heavy protection has created a high profit margin in the Chinese auto market, which has brought huge profits to the Chinese auto giants that are favored by the authorities, but this is not enough to make them face the next challenge.
Everyone wants to enter the Chinese automotive market, from the multinational giants to local private enterprise owners. The blowout market in China's auto market that began in 2002 was still strong in 2003, and its momentum will continue at least until 2004, and no one questioned this assertion.
Data from the China Association of Automobile Manufacturers shows that in the first 11 months of 2003, 4005321 vehicles were produced, a year-on-year increase of 36.38%, and 3,917,546 were sold, an increase of 32.20% year-on-year. The annual production of automobiles is expected to reach 4.2 million, of which cars will exceed 2 million, and a total of more than 50 new models will be launched. These figures not only contrasted sharply with the stagnation of the global auto industry, but also made the experts optimistic about the forecast (about 20%) at the beginning of 2003 was underestimated across the board. In terms of quantity, China’s auto market has been ranked fourth in the world.
The enormous potential of the Chinese market is consistent with the strategy of many multinational auto companies to reduce production costs and increase market competitiveness, and a new round of strategies for optimal allocation of resources on a global scale will coincide. An upsurge of investment and capital increase reached in 2003. The peak.
Expanding China's investment and production capacity and strengthening its competitiveness in China is a common strategy of all multinational giants that have invested in China: German Volkswagen announced a huge investment plan of 6 billion euros, and DaimlerChrysler will invest in cooperation with BAIC. 1 billion euros for the production of Mercedes-Benz sedans, heavy trucks and engines. Ford chairman and chief executive Bill Ford made a commitment to increase investment in China by US$1 billion in Beijing. General Motors chairman and chief executive officer Wagner announced at the end of 2003. Cadillac made domestic and Shanghai GM's capital increase plans for doubling in 2006. Toyota, BMW, and Mercedes-Benz, which used to sell cars in China but not cars, have also bet.
Of course, the most interesting is Dongfeng Motor Co., Ltd., a joint venture between Dongfeng Motor Group and Nissan Motor Co., Ltd., a company with a registered capital of 16.7 billion yuan. This joint venture has an unprecedented depth and covers the core of Dongfeng Motor. Car assets.
Not only that, China’s domestic capital has not concealed its love for the auto industry. Kelon, BYD and other powerful private companies have invested in the auto industry across industries, and Great Wall Motor’s successful assault has been listed in Hong Kong. Zhejiang Ningbo Huaxiang Group, China Such as auto parts companies, such as the Fitch Group, have transformed into full vehicle companies through acquisitions or backdoors. And on this list there are more familiar names: Midea, Xinfei, Oaks, Sany, and even Wuliangye Group. According to statistics, in Zhejiang Province, where the private economy is developed, except for Geely, which has achieved a full vehicle production catalog, there are currently 28 private enterprises entering the vehicle manufacturing industry. On the table of the National Development and Reform Commission, there are 40 applications from Zhejiang's private enterprises to obtain a full-automobile production catalog.
The average profit rate of cars in the world is around 5%, and the average profit margin of luxury cars is only 8% to 10%. In China, this ratio is 30%. Not only the profits are extremely high, but also the phenomena of queued purchases and even price increase purchases that have not been seen in China have suddenly appeared in a considerable number of automotive specialty stores. On the other side of the ocean, in the United States, the country with the largest automobile production and consumption, GM is using loan interest discounts to attract car buyers. The extremely high profits of China's auto market and the distinctive features it presents in the international market come from China's consistent protection policy for the domestic auto industry. Ma Yu, a research fellow at the Ministry of Commerce, said that the Chinese auto market looks beautiful, but in fact it is a completely distorted market. “In the case of domestic car prices that are at least 20% higher than international car prices, we must also increase the price line. This is not a distorted market. What is it?â€
It is worth noting that the prosperous situation is not balanced. In 2003, the overall supply was in short supply. Only the imported high-end cars were increased, and most of the economical cars were reduced prices. In particular, local manufacturers such as Geely and Chery had too high targets set at the beginning of the year. It is difficult to complete the sales plan. "Unbalance resulted from misjudgments, and it is always thought that the cheaper the better it is to sell. The judgment of the car entering the family is too optimistic, so there is an excess of economical cars," said an industry source.