Tag Archives: chery

Automotive Brand-Building In China: Opportunities And Challenges Abound

Western, Chinese Brands Vie For Customer Loyalty As Emerging Middle Class And “Nouveau Riche” Demand Continues To Grow

Buick has capitalized on its reputation for quality and luxury in the Chinese market, enjoying massive success and launching China-only models like the Excelle

Buick has capitalized on its reputation for quality and luxury in the Chinese market, enjoying massive success and launching China-only models like the Excelle

As demand for new vehicles has remained sluggish in developed markets over the past two years, major automakers have rightly looked to retool their strategies to draw customers and build their brands in new markets. As we’ve written before, selling your brand in markets like China, where customers expect different things — and derive status from very specific brand attributes —  represents both a major opportunity and a new challenge. A good example of an automaker that has benefitted from the “blank slate” allowed it by entry into the young Chinese market is Buick, which has a reputation as a car for older, or middle-aged, drivers in its native market, the USA, yet has — through aggressive branding and advertising efforts — developed a reputation as a sleek, luxurious, youthful brand in the Chinese market.

So how can car brands optimize their brand equity in China? Depending on where they come from, their strategies differ greatly. While American car makers like Ford have had great success in overseas markets like Europe by pushing their reliability and value, in the Chinese market imported cars are, generally, chosen by buyers to be a status symbol, rather than “inexpensive.” Ford, then, cannot compete on price alone, as Chinese automakers like Chery and Geely — which have sizeable lineups of entry-level models — will always be able to undercut them. As a result, it is important for foreign car makers to not just build their brand in China, but to build a strong brand in China, one that speaks to Chinese consumers in a way that domestically-produced autos cannot. To break it down further, foreign automakers need to build a strong, distinctive brand — a German car must fit Chinese conceptions of German cars, Japanese cars Japanese attributes and so on.

In practice, how are foreign automakers faring in their Chinese branding strategies? Today, Reuters looks into the “uphill road” these brands are traveling in China, and how they have refocused their branding strategies to varying degrees of success. Using the example of a “nouveau riche” car buyers who has traded his BMW in for an Audi  — since the Audi has developed a strong reputation in China as a car for bureaucrats or (comparatively) “old money” while BMW is considered a brand for the nouveau riche (a group into which the buyer in question is loath to be grouped) — the article provides valuable insight into the particularities of a market so new that even seasoned marketers and branding execs are often at a loss to develop long-term strategies.

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Dongfeng, Geely, Great Wall, BYD Set For Rapid Growth In Chinese Auto Market

Analysts Indicate That Low Ownership Rates, Government Subsidies May Spur Faster Growth Of World’s Largest Auto Market

Dongfeng is looking to compete with other domestic Chinese brands to capture market share from foreign competitors

Dongfeng is looking to compete with other domestic Chinese brands to capture market share from foreign competitors

From the recent Shanghai Auto Show to news that the Chinese government plans to offer higher subsidies for consumers trading in old vehicles for new ones, China’s auto market has been a busy place in recent months. With the sluggish performance of carmakers in more developed global markets, the news that auto shares in China — currently the world’s biggest car market — are expected to outperform this year will, in many ways, comfort global auto companies.

However, as we have previously discussed, the news that Chinese car buyers are growing rapidly as a consumer base shouldn’t be enough for foreign automakers — as domestic brands like BYD, Geely, Chery and others vie for dominance in this rapidly-changing market, foreign automakers will have to invest heavily if they are to keep the lead they have built in the last 10-20 years.

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Chinese Automakers Developing “Luxury With Chinese Characteristics”, Adapting From Porsche, BMW

Formerly Budget-Focused Brands Like Geely Shifting To Lucrative High-End Consumer Segment

The Chinese middle class is an important and growing consumer segment, and Chinese domestic brands are increasingly relying on this group's future purchasing power to drive global growth

The Chinese middle class is an important and growing consumer segment, and Chinese domestic brands are increasingly relying on this group's future purchasing power to drive global growth

The Wall Street Journal has a great profile today about Chinese auto brands that have shifted 180 degrees in the last few years, changing their target market from the younger, budget-conscious first-time car buyer to wealthier buyers who may already own one or more vehicles. This represents a very significant change in tactic on the part of Chinese automakers, who until recently had all but given up on this consumer bracket, apparently convinced that it would be impossible to compete with foreign luxury carmakers like Mercedes and BMW, two brands that have made commanding inroads in the China market.

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Geely, Great Wall, Chery Show China’s Domestic Luxury Auto Market Shifting Into Gear

New Luxury Models From Geely, Great Wall Target Evolving Market, Seeking Market Share From Foreign Brands

The Geely GE: Will Geely's Foray Into The Luxury Market Pay Off? © Geely

The Geely GE: Could Geely's first foray into the luxury market pay off? © Geely

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At the Shanghai Auto Show, foreign car executives have been discussing the prospects for their brands in the mainland China market as domestic carmakers begin to move beyond their traditional low price-point and into more high-end, luxury segments.

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