Local SUVs gain market share
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E-mail CNTV, April 24, 2015
SUVs are becoming more and more popular in China, and while foreign-invested automakers are building more of them here, much of the growth in production is being fueled by Chinese automakers. At the 2015 Shanghai auto show, Chinese domestic brands were on display with more attractive designs and more attractive prices too.
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SUVs are becoming more and more popular in China, and while foreign-invested automakers are building more of them here, much of the growth in production is being fueled by Chinese automakers. |
Great Wall's Haval has drawn a lot of attention. Thousands viewed the new Haval H6 Coupe, a sporty compact SUV based on the country's best selling SUV, the Haval H6. The company sold 88 thousand units in just the first quarter of the year.
The best selling SUV in the market now is made by Great Wall, so I thought I would take a look at the Coupe.
Great Wall is not the only Chinese manufacturer doing well in the market. The China Association of Automobile Manufacturers says that in the first quarter of 2015, domestic SUVs took up more than 56 percent of the China market. That's a 16.2 percent increase in one year. Chinese automakers have adopted a strategy catering to the needs of price-sensitive Chinese customers, by producing low-price vehicles for a market niche ignored by joint venture and foreign brands.
"We feel the pressure of competition certainly. Actually starting a few years ago, we put together a full production lineup, from compact to medium size cars, and with a price range from 80 thousand to 250,000 yuan," said Tao Qinghua, Director of Product Planning, Great Motor.
In fact, the price advantage of domestic SUVs is huge. Compared to joint venture brands, most domestically produced SUVs' are priced at only around 100,000 RMB. That's 30 to 50 percent cheaper than the joint venture brands. The cheapest model of the Haval H6 Coupe, for example, sells for 140,000 RMB.
"The biggest advantage of Chinese-produced SUVs is their low price. There's no doubt of that. Domestic SUVs have a relatively low point and that's how they attract customers. But it's also important to point out that Chinese-made brands have significantly improved their design, interior systems, and vehicle performance in the past two years. Customers are clearly acknowledging these improvements," said Zhong Shi, chief editor of China Automotive Review.
Great Wall's competitor -- the Shanghai Automotive Industry Corporation -- also launched its new compact SUV at the auto show, the MG GS. The MG GS now has seven models under the family design offering different configurations and ranging in price from 120,000 to 180,000 RMB. The diversification gives price-sensitive consumers more choices, a common strategy of local automakers.
"Customers need more choices. We set the price of our new car very low and we put a number of different versions out on the market. We want more people to experience our new MG GS," said Chu Jian, Director of Product Planning, SAIC Motor.
Not to be out-done, Chang'an Automobile showcased the Suzuki Vitara, which will debut by the end of this year. The Liebao CS 10, Baojun's 560, the BYD Yuan and several other SUVs made their debuts at the show as well. Chinese automakers sold 730,000 SUVs in the first quarter of 2015, 160,000 more than the joint-ventures and foreign automakers.
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