Chapter 6 3. The Promise of the Automobile Industry

The automobile wave began to sweep China.In this fiercely competitive and booming field, China has global influence. In 2010, China overtook its former arch-rival Japan, ranking first in the world with a global automobile production of 13.8 million. World number one!In China, more than 6,000 companies have been attracted to the future automotive field.Twenty of the world's 50 most important automakers are Chinese. In the decade from 2000 to the present, China produced 565,000 vehicles per year (the same level as Poland).Thanks to rapid economic growth and the demands of a growing middle class, China's industrial machinery is already spinning at super high speed.

Since China joined the WTO in 2001, the automobile industry has developed rapidly.Then in 2006, China overtook the US!Since then, agreements and joint-ventures between international brands and Chinese brands have grown. The era of cycling on the main roads of big cities is far away from us. That was China ten years ago. In a race for speed -- compared with dozens of domestic brands and rival Toyota -- automaker BYD (Build Your Dreams) is 24th as it hopes to become the world's automaker in 2015 First. In Shanghai, a city thousands of kilometers away from its birthplace, Detroit, far away from Michigan, General Motors has risen from the ashes like a phoenix.This American group is now a veritable Chinese tiger!

Seeing the huge and potential market in China, those famous auto brands in Asia will definitely smile.For China, this is just the beginning.Because in this highly competitive market, the huge appetite of Chinese consumers is still growing. Someone wants to ask: How big will the Chinese market be?That is simply immeasurable: 20% of China's 1.4 billion people are under the age of 15... Whether it is in the production field or in the sales field, China's auto industry will develop explosively.By 2020, China will demonstrate three times the potential of India and 20 times the potential of Germany.China's car manufacturers are stepping up their development and growth, such as the Chinese car brand "Great Wall", and Chinese-made Chevrolet and Mercedes-Benz.

Today, there are nearly 100 automakers in China.The growth of the middle class has accelerated the expansion of the Chinese brand market.At present, only 3% of Chinese people own cars! Double-digit growth forecasts for this sector are surprising.Manufacturers are increasing their sales even further (up 33% in 2010) by broadening their range of sales. In Beijing, 2,000 new cars hit the road every day!The capital of China has the worst traffic in the world, full of traffic jams.Of course, Beijing has also taken some restrictive measures.But in the face of a growing market, these measures undoubtedly have little effect.

In 2011, Beijing implemented a "monthly license plate lottery" policy.Broadcast on TV and online, the latest draw produced 17,600 winners... in an attempt to limit the number of new cars the city adds each year to 240,000! In China, this is only the beginning of enthusiasm for private cars.The Chinese people's fondness for luxury cars or limousines reveals their desire to enter a prosperous society.Daimler, for example, managed to sell its Mercedes-Benz S-Class for more than 150,000 euros, more expensive than in the US and Europe. The monthly sales volume of Mercedes-Benz S-Class is 1,600 units! In September 2009, China became the company's largest market in the world.Currently, as a mass consumption phenomenon, demand for all makes and models is increasing, all thanks to China's economic growth.

China will end tax incentives for car purchases.Reduce traffic congestion in cities by limiting the number of cars.Beijing will extend a policy limiting car traffic for two years.It requires a reasonable plan to control all road traffic. Liu Daizong believes that the number of newly increased cars should be controlled.However, the effect is completely opposite!These restrictions, which attempted to slow the growth in the number of cars, led to more purchases instead.This single policy will not smooth traffic in Beijing.The city needs more effective countermeasures! All Chinese cities are facing this problem.The citizens of Beijing know this very well!During certain hours, you have to leave the house very early if you want to get to your destination on time.Because experience tells us that sudden traffic jams abound, and it is not surprising.

In the fifteen big cities in China, the problem of poor traffic causes losses of 110 million euros every day.And as car sales continue to grow, the problem is exacerbating.In Shanghai, the price of a license plate has already exceeded 4,000 euros! In 2009, China has become the world's largest auto market.Compared with 2009, 2010 has a great increase, an increase of 32%.As shown in the table below, in 2010, China's auto production and sales hit a new world record of 18.26 million and 18.06 million respectively.In addition, due to the very strong demand for automobiles, the ratio of production and sales of automobiles is almost close to 100%.

Statistical Table of Automobile Production and Sales in China in 2010 Production and sales Unit: million units of growth Unit: million units of growth Total 18.26 32.44% 18.06 32.37% Passenger vehicles 13.89 33.83% 13.75 33.17% Private car 9.57 28.17% 9.49 27.05% Multi-purpose vehicle (MPVa) 0.45 79.89% 0.44 78.92% Sports utility vehicle (SUVb) 1.33 103.38% 1.32 101.27% Crossover passenger car 2.33 26.36% 2.49 27.77% Commercial vehicle 4.36 28.19% 4.30 29.90% Bus 0.35 29.93% 0.35 31.30% Truck 2.85 22.72% 2.83 25.83% Semi-trailer 0.36 74.11% 0.35 67.98% Semi-finished bus 0.08 8.07% 0.08 4.93%

Semi-finished trucks 0.70 36.6% 0.67 35.53% Fortunately, Chinese manufacturers have started a new competition: electric vehicles. China and its automakers know they have a chance to beat rivals like the U.S., Germany, France and Japan over the next few years.Electric vehicles will occupy the Chinese market of 80 billion to 175 billion euros!Electric vehicles will account for 20% to 30% of the entire Chinese auto market. To solidify its world leadership in electric vehicles, China will leverage its labor-intensive, cutting-edge technology and growing auto market to develop economies of scale.

China will become the vanguard of the electric vehicle industry.The Chinese government restricts oil imports and supports environmental protection.That means transitioning from an expensive technology to a cost-effective one, and it will be widely rolled out. Chinese people, like people in other countries, also desire to own personal property, desire to own one or more cars!According to Forbes magazine statistics, 74 million Chinese families dream of owning a car. In the last five-year plan (2006-2010) of China's auto industry, China expected its auto market to surpass that of the United States by 2020.And this has become a reality in 2009!

Exceeding previous expectations, China has become the world's largest auto market, far ahead of the United States.If China achieves a leading position in this field, it will also become the leader in global automobile production. The cars produced will be consumed by the country's domestic market.So don't be surprised that Chinese car brands are not well known in other countries.This is just the status quo! The adjustment of Chinese enterprises will bring China to a leading position in the field of clean vehicles. In the near future, Chinese brands will be exported to Western countries.They will occupy a considerable part of the world market. By 2030, China will have a considerable total vehicle volume, playing an important role in this field.Chinese automakers will gradually show their imagination!New technical concepts and bold aesthetic lines bring Chinese innovation to life. China has boosted profits across the industry, becoming the dominant force in the international auto market.Whether in the automotive, energy, raw materials, or financial sectors, numerous Chinese companies will continue to grow both in China and in the West.