Automakers drive China's export recovery

A cargo ship is ready to load cars for export at Yantai Port in Shandong province on March 14. TANG KE/FOR CHINA DAILY

Edge in electrification, respect for local demands prove big game-changers
 

Made-in-China vehicles are gaining overseas popularity, which is expected to drive exports that serve as a major pillar of the country's economic growth.
 

In the first two months this year, ships loaded with 682,000 vehicles left China for overseas destinations, up 43 percent year-on-year, according to the General Administration of Customs.
 

Those vehicles' combined value totaled 96.83 billion yuan ($14.1 billion), up almost 79 percent year-on-year. In the same period, China's total exports added up to 3.5 trillion yuan, up 0.9 percent year-on-year. In other words, auto exports accounted for 2.8 percent of the country's total exports.
 

The China Association of Automobile Manufacturers expects the auto industry to increase its share of China's exports in the future, adding vehicle exports this year will rise by at least 20 percent year-on-year to 3.73 million units.
 

The CAAM's confidence sprang from the fact that China overtook Germany as the world's second-largest vehicle exporter in 2022, delivering 3.11 million vehicles to overseas buyers.
 

The industry's top association attributed the export surge to foreign manufacturers' insufficient supplies in respective local markets and, more importantly, Chinese companies' advantage in electric vehicles.
 

To seize the opportunities, local authorities in coastal regions including Shanghai and Guangdong province are working to facilitate exports that are recovering in the post-COVID-19 era.
 

"We are experiencing rapid growth in NEV exports and we expect our measures will help grow the volume and optimize the structure of our foreign trade," said Hu Hong, deputy secretary-general of the Guangdong provincial government, on March 20.
 

Nansha in the South China province is one of the country's busiest ports for vehicle exports.
 

In late March, an NYK Line ship loaded with 3,600 electric Neta Vs made by Hozon left the port for Thailand and neighboring countries, making the largest single shipment among Chinese NEV startups.
 

Days earlier, Chinese logistics company Anji unveiled a route from Ningde, Fujian province, where SAIC produces its MG vehicles, to Lazaro Cardenas, a port city in Mexico.
 

The 13,500-kilometer voyage will take around 23 days, three to five days less than the previous method of transporting the vehicles from SAIC's Ningde plant to Shanghai and then shipping them.
 

Chen Shihua, deputy secretary-general of the CAAM, said made-in-China vehicles have shaken off their stereotypes thanks to their competitive edge in electrification and cutting-edge onboard features.
 

"Destinations of exports tell something. Our NEVs are selling well in new destinations where we failed to get a foothold previously, like Europe," said Chen.
 

New York-listed Chinese startup Nio entered Europe in 2021 with Norway as its first stop. In 2022, it expanded into four other European countries including Germany and Sweden.

Its electric sedan ET7 was named late last year as the best model in the "Medium and Upper Class" category in the 47-year-old Golden Steering Wheel competition in Germany.
 

The award made Nio the first Chinese automaker to win the much-coveted accolade, which is usually won by German and Japanese brands.
 

SAIC Motor, China's largest carmaker by sales, expected the deliveries in March of its hatchback MG4 Electric to reach 10,000 units in Europe.
 

There are now around 40,000 orders in Europe to be delivered, said Zhao Aimin, executive vice-president of SAIC International.
 

Zhao said one important ingredient of SAIC's success in overseas markets is to offer competitive products based on an understanding of local customers' demands.
 

"Every week I have a four-hour meeting with our research and development colleagues," said Zhao, who offers feedback gleaned from direct exchanges with overseas car buyers and potential customers.
 

SAIC launched the MG4 Electric hatchback in 2022, which is its first model developed with global markets in mind.
 

It is the result of SAIC's Chinese and British teams and has won top ratings in new car quality programs across different regions, including the famously strict European New Car Assessment Program.
 

He expects the model's overseas sales this year to reach 150,000 units. Zhao said the result has been "motivating and assuring", adding that three to four models developed for global markets will follow by late 2024 or early 2025.
 

Besides products, a sustainable sales network is crucial, Zhao said. "Without our local dealers, we can't reach our customers no matter how good our products are.
 

"The top priority is the voice of our salespeople. We listen to them and we discuss to ensure our network is healthy."
 

SAIC has been China's largest vehicle exporter for seven years in a row. It exported 1.02 million vehicles in 2022, up almost 46 percent year-on-year, and 65 percent of them were SAIC's brands, primarily MG and Maxus.
 

"Around one in three Chinese vehicles sold overseas are SAIC ones," said Zhao. He expects the figure to grow to 1.2 million vehicles this year, with Europe, the Middle East and Mexico among its major markets, and up to 70 percent of the products to be SAIC's own brands.
 

Beijing-based BAIC Group expects its overseas sales of passenger vehicles to reach 30,000 units this year in overseas markets, up from 18,215 units in 2021, said Patrick Yang, general manager of BAIC International Development Co.
 

BAIC's lineup is primarily composed of gasoline vehicles, but they are well received as well in some markets. "In Saudi Arabia, Chinese automakers have a total market share of about 20 percent," said Yang.
 

He said it has something to do with Chinese carmakers' repositioning of their models. "Chinese vehicles used to be seen as merely tools of transport, so local customers would like them to be sold at prices as low as possible.
 

"But we are now moving upward with our competitive new-generation products, like the X7 and BJ40 series."
 

Among high-profile buyers of the Beijing BJ40 SUV is Francois Steyn, a professional rugby union player in South Africa. And in Costa Rica, they include Keylor Navas, a goalkeeper for Premier League football club Nottingham Forest.
 

Its compact Beijing X55 SUV, which was introduced into South Africa in late 2022, was named as a finalist in the Car of the Year competition in the country in January.
 

Yang said the average price of the company's passenger vehicles will rise to $14,000 this year from around $12,000 in 2022.
 

Zhao at SAIC said China-made vehicles' growing recognition overseas makes those in the Chinese auto industry proud. But he is quick to add that there is still a long way to go to reach the level of well-established international giants.
 

"There lies a long way for Chinese brands to go up (in the global market)," said Zhao. He admitted that when SAIC planned the MG4 Electric, the dream was to make it as popular as Volkswagen's Golf, "a really international model".
 

Zhao called on Chinese companies to have "less talk but more walk".
 

"What we should do is to offer our international customers great products, enable our local dealers to make money and make some money ourselves as well."

Source: China Daily

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