Tag Archives: car

Luxury Car Sector Continues To Thrive in China

New Models, Stimulus Package Continue To Drive Growth In World’s Top Automotive Market Despite Global Woes

China is one of Audi's most reliable and profitable markets; As Chinese luxury auto brands emerge, will they retain their dominance?

China is one of Audi's most reliable and profitable markets; As Chinese luxury auto brands emerge, will they retain their dominance?

The sustained growth seen in the Chinese automotive market over the last year has shown that the vast Chinese market — vast both in size and in potential customers — still has plenty of room to grow. For luxury carmakers, who’ve had a tough year in markets like North America and Europe, recent figures that show Chinese buyers are still motivated to part with their cash are welcome, to say the least, as formerly reliable customers in the US and other major economies think twice before signing on the dotted line.

According to this Wall Street Journal Asia article, growth in the Chinese market has been unprecedented in recent months for foreign luxury automakers, and with the stimulus package — aimed at infrastructure projects — taking effect, companies like Audi (a favorite of China’s government elite), BMW (the flashy entrepreneur’s choice) and Mercedes (the mark of a true “sophisticate” in China) expect to see their fortunes continue in the years ahead:

Audi’s sales in China rose 37% in September from a year earlier to more than 15,000 cars, marking a new record level in terms of monthly vehicle sales, the Ingolstadt, Germany-based auto maker said.

In the January-to-September period, Audi’s sales totaled 108,859 vehicles in China, up 20% from a year earlier.

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China’s “Old School Luxury Car” Gets International Attention

Hong Qi (Red Flag) Limousines Driven In National Day Parade Provoke Speculation Among China Car Watchers

The newest Hong Qi limo, used in the National Day parade, features traditional design elements that will appeal to many in China (Photo: Xinhua)

The newest Hong Qi limo, used in the National Day parade, features traditional design elements that will appeal to many in China (Photo: Xinhua)

This week, during China’s National Day parade, many viewers saw for the first time China’s first (and some would say only) luxury car brand — Hong Qi (Red Flag) — in action, carrying President Hu Jintao and Lieutenant General Fang Fenghui to Tian’anmen. For people unfamiliar with China’s exclusive home-grown luxury vehicle — generally reserved only for top leaders — what’s beneath the hood of Hong Qi’s newest model?

China Car Times takes a look:

Information on the cars used in this years National Day celebrations is thin on the ground, we have learned that they measure 6.4 meters long, 2.05 meters wide and are 1.72 meters high, and with power being delivered by a V12 engine. The cars were considered state secrets during their development and were all hand made by First Automobile Workers in Changchun.

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BYD’s Wang Chuanfu Tops China’s Rich List On Heels Of Buffett Investment

Wang Jumps 102 Spots To Head The Hurun Report’s “Rich List”; Now Worth $5.1 Billion

BYD's Wang Chuanfu is now worth over US $5 billion, putting him at the top of China's "Rich List"

BYD's Wang Chuanfu is now worth over US $5 billion, putting him at the top of China's "Rich List"

Last week, we saw what the endorsement of a financial heavyweight like Warren Buffett can do for a little-known Chinese company, with the stock of Dayang Trands skyrocketing 71% following Buffett’s praises of the company’s bespoke suits. In the automotive sector, today China Herald (via Bloomberg) points out that Buffett’s investment in previously low-key Chinese battery and hybrid/electric car maker BYD has not only given the brand global visibility, it has made the company’s head, Wang Chuanfu, a very rich man and putting him at the top of the Hurun Report’s China Rich List beating China’s longtime #1, Zhang Yin.

[Wang's] wealth jumped to $5.1 billion, exceeding Nine Dragons Paper Holdings Ltd. founder Zhang Yin’s $4.9 billion, according to an e-mailed statement from the Hurun Report today.

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Japan’s Mitsuoka Motor Co. To Enter Chinese Market

Japanese Luxury Automaker Plans To Open Beijing Showroom By Q1 2010

The Mitsuoka Orochi will retail for around 800,000 RMB (US $117,177) in China when it arrives next year

The Mitsuoka Orochi will retail for around 800,000 RMB (US $117,177) in China when it arrives next year

The growing Chinese luxury market is a prime target for many Asian companies that have found demand in their home countries — mainly South Korea and Japan — either growing at a snail’s pace or simply remaining stagnant. As formerly luxury-mad consumers in traditional markets like Japan cut back on their spending, high-end Japanese companies have started to look abroad for more opportunities, with China remaining the natural choice as a result of its proximity and massive population.

Recently, Japan’s Mitsuoka Motor Co., one of the country’s major luxury automakers, announced their plans to enter the Chinese market next year, starting with a showroom in Beijing that is slated to open in April. To lead their China efforts, the company will display their Orochi model at next year’s Beijing Auto Show and follow up their Beijing strategy with new dealerships in other top-tier cities:

The Orochi will spearhead Mitsuoka’s debut into China. The company plans to display the car at next year’s Beijing Auto Show, and to open dealerships in Beijing, Shanghai and Guangzhou.

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Bentley Mulsanne: One Eye On The China Market?

Will Bentley Follow The Success Of Rolls-Royce In The Chinese Market? Or Will More Chinese Luxury Buyers Opt For Rival Brands?

The Bentley Mulsanne includes many features popular in the Chinese market, such as a spacious interior and chauffeur-ready driver's seat

The Bentley Mulsanne includes many features popular in the Chinese market, such as a spacious interior and chauffeur-ready driver's seat

As we’ve pointed out time and time again, with the global doldrums cutting into the vehicle budgets of many luxury consumers in developed markets like North America, Japan and Europe, high-end car companies like Rolls-Royce have increasingly looked to emerging markets like China to get them through the economic crisis and create a new, loyal buyer’s market. As Chinese luxury models become more prevalent (and popular) over time and truly begin to rival the dominant luxury models by BMW, Mercedes-Benz and Porsche, automakers at the highest end are already starting to plan ahead for a strong China strategy to ensure their brands remain at the top of the heap for years to come.

Following the lead of the 2010 Porsche Panamera, which was unveiled at this year’s Shanghai Auto Show, Bentley has taken the lid off of its 2011 Mulsanne, with what is sure to be an eye towards the Chinese market — where the country’s ultra-rich still have no domestic alternative that can match Bentley quality. After making its initial debut in August, the Mulsanne has become the talk of the high-end luxury scene, not least because it is the first all-new Bentley model to roll off the production line since the 1930s. As Motor Authority writes, though this car is most certainly beyond the budgets of most lustful car enthusiasts, it is a sight to behold and has an engine to match:

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BMW, Mercedes and Audi May Have A New Competitor In China’s Chang’an

Chongqing-Based Automaker, Building On Additional Visibility Gained During Olympics, Eyes Luxury Segment

Chang'an's luxury concepts build on the CD101 platform unveiled earlier this year at the Shanghai Auto Show

Chang'an's luxury concepts build on the CD101 platform unveiled earlier this year at the Shanghai Auto Show

Over the last year, Chinese automakers have made a big push to gain domestic popularity and international pathways for future growth, with high-visibility announcements like Sichuan Tengzhong’s acquisition of Hummer and BYD’s plans to enter the American market as soon as 2010. These Chinese automakers have done a pretty good job of selling their lower-priced models to first-time car buyers throughout the mainland — mainly 20-something middle class workers in urban centers — but what about high end models?

While several Chinese car companies have tried to appeal to this segment in the past — with Red Flag (Hongqi) immediately springing to mind, along with the newly-unveiled Geely GE — their success can be described as mixed, at best. While Red Flag remains the car of choice for China’s government elite, among high-powered businesspeople or the otherwise well-off, the luxury car market in China remains dominated by foreign brands. Even at the highest level, Red Flag doesn’t even make the list, with the Rolls-Royce Phantom, Bentley Arnage, and Maybach making up the top three favored models in China.

According to a new article in China Car Times, however, it looks like Sichuan-based Chang’an is looking to target the domestic luxury car buyer as soon as next year. Will Chang’an have better luck reaching a wider luxury audience? From the looks of the new concept photos on CCT, it looks like they are closer than ever to becoming a true rival to Audi, BMW and Mercedes in the mainland market, at least aesthetically. Now the question, as always, remains, can Chinese carmakers once and for all rid domestic consumers of the notion that foreign car brands are superior?

GM And China A Time-Tested Fit

The American Automaker Is Enjoying Record Gains In China’s Rapidly-Growing Automotive Market, Despite Difficulties At Home

GM has enjoyed record success in China over the past four years. But will domestic upstarts like BYD woo Chinese car buyers away? Photo © BusinessWeek

GM has enjoyed record success in China over the past four years. But will domestic upstarts like BYD woo Chinese car buyers away? Photo © BusinessWeek

With GM’s impending bankruptcy and restructuring in the news over the last week, it is easy to lose sight of the company’s global reach and mixed revenues. Although the company has had unprecedented difficulties in the North American market, brought on by the global economic downturn, in China — where the company has operated (with a roughly 30-year interruption) for decades — GM has been the leading foreign carmaker for the last four years.

Although China’s domestic car makers — spurred by huge foreign and government investment over the past few years — are making great strides, since the formation of the Shanghai GM joint venture in 1997, the company has worked hard to rebrand itself for the China market. All of this work has paid off in China, since as of last year, GM built an estimated market share of 12.1% on sales of nearly to 1.1 million units.

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