Background to the success of Chinese manufacturers<\/h1>\n\n Munich, August 2024<\/span>\n <\/div>\n <\/div>\n <\/div>\n <\/div>\n \t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t\n\t\t\t\t\t\t\n\t\t\t\t\t\n\t\t\t\n\t\t\t\t\t\t\n\t\t\t\t\n\t\t\t\t\t\n\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\n \n\n\n \n \n\n 2<\/span>\n 023 was a successful year for the Chinese car market. A total of 21.9 million passenger cars were sold in 2023 (domestic sales only, excluding exports), an increase of 4.3% compared to 2022. <\/p>\n\n <\/div>\n\n \n\n <\/div>\n \t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
\n\t\t\t\t\n\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\t\t\tAs in recent years, EVs (referred to as NEVs in China, equivalent to xEVs) displaced ICEs \u2013 and their share continued to grow to around 36% of the total market, an increase of 33%<\/b> year on year (see figure 1).<\/span><\/div>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\t\n\t\t\t\n\t\t\t\t\t\t<\/span>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\t\t\tFigure 1: NEVs have been on the rise for quite some time<\/span><\/strong><\/em><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t![\"\"](\"https:\/\/www.berylls.com\/wp-content\/uploads\/2024\/08\/Berylls_NEVs-on-the-rise.png\")
\t\t\t\t\t\t\t\t<\/a>\n\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\n \n \n Source: Berylls by AlixPartners, CAAM, CPCA<\/p> <\/div>\n <\/div>\n\n\n \t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
\n\t\t\t\t\n\t\t\t\t\t\n\t\t\t\n\t\t\t\t\t\t<\/span>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\t\t\tLooking at the domestic market, it is clear that Chinese players continue to dominate, as they have done in recent years. Especially for battery electric vehicles (BEVs), the following companies stand out: BYD (2.7 million units sold), GAC Aion (483,000 units sold), Geely (469,000 units sold), Chang\u2019An (385,000 units sold), Li Auto (376,000 units sold), and NIO (160,000 units sold). Only Chinese manufacturers are among the top 10 best-selling BEV brands, with one exception: Tesla with 604,000 units sold in 2023 (see figure 2).<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
\n\t\t\t\t\n\t\t\t\t\t\n\t\t\t\n\t\t\t\t\t\t<\/span>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\t\t\tFigure 2: The Chinese NEV market is dominated by mostly local players<\/strong><\/em><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t![\"\"](\"https:\/\/www.berylls.com\/wp-content\/uploads\/2024\/08\/Berylsl_NEV-market-dominated.png\")
\t\t\t\t\t\t\t\t<\/a>\n\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\n \n \n Source: Berylls by AlixPartners, CPCA<\/p> <\/div>\n <\/div>\n\n\n \t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
\n\t\t\t\t\n\t\t\t\t\t\n\t\t\t\n\t\t\t\t\t\t<\/span>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\t\t\tAt the same time, the success of Chinese OEMs can also be seen on foreign markets. The export volumes of Chinese OEMs have increased massively in recent years for both types of drivetrain. The total export volume has increased by >400% since 2020 and grew very strongly by 65.3% year on year in 2023. While the trend can be seen in both segments, the export volume for EVs has grown even more strongly than for conventional ICEs \u2013 for example, sales of electric vehicles in China have increased more than tenfold since 2018 (2018: 140,000, 2023: 1.68 million units sold). Although Chinese OEMs have not yet made their mark in established Western markets such as Western Europe, they are determined to do so. We can therefore expect to see more activity by Chinese OEMs in such markets in the future (see figure 3).<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
\n\t\t\t\t\n\t\t\t\t\t\n\t\t\t\n\t\t\t\t\t\t<\/span>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\t\t\tFigure 3: At the same time, overseas activities have massively increased<\/em><\/strong><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\t\t\t\t\t\t\t\t\t\t\n\t\t\t\t\t\t\t![\"\"](\"https:\/\/www.berylls.com\/wp-content\/uploads\/2024\/08\/Berylls_Overseas-activities.png\")
\t\t\t\t\t\t\t\t<\/a>\n\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\n \n \n Source: Berylls by AlixPartners, CPCA, Press<\/p> <\/div>\n <\/div>\n\n\n \t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
\n\t\t\t\t\n\t\t\t\t\t\n\t\t\t\n\t\t\t\t\t\t<\/span>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\t\t\tHow did this development come about? There are a number of reasons for this, the first being the acceptance of EVs among Chinese consumers. Despite the absence of buyer incentives or \u201cmoney in the trunk\u201d from the state, the majority of Chinese consumers are turning to EVs. A Berylls study with over 1,000 respondents shows that 56% of vehicle owners and 42% of first-time buyers would opt for a EV when choosing their next car. At the same time, Chinese brands are predominantly being chosen (in terms of EVs), with 46% of all car owners and 61% among first-time buyers. In a direct comparison, only 32% (car owners) and 23% (first-time buyers) would opt for EVs from German brands!<\/p>
This finding is related to reason 2: The number of Chinese brands has increased significantly in recent years and at the same time Chinese brands are comparatively \u201cbetter\u201d than their foreign JV competitors. \u201cBetter\u201d means in this case: the customer gets more (functions and technology) for less money.<\/p>
And a lower price is the third reason. An unprecedented discount battle took place in 2024. Driven by Tesla\u2019s price cuts for the Model 3 and Model Y, Chinese OEMs lowered their prices significantly. Foreign OEMs\/JVs also followed suit, as can be clearly seen from the example of the ID.3 made by SAIC-VW. ICEs are also affected by this, with the FAW-Audi A4L starting at less than EUR 30,000.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
\n\t\t\t\t\n\t\t\t\t\t\n\t\t\t\n\t\t\t\t\t\t<\/span>\n\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\t\t\t
023 was a successful year for the Chinese car market. A total of 21.9 million passenger cars were sold in 2023 (domestic sales only, excluding exports), an increase of 4.3% compared to 2022. <\/p>\n\n <\/div>\n\n \n\n <\/div>\n \t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
Figure 1: NEVs have been on the rise for quite some time<\/span><\/strong><\/em><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t Source: Berylls by AlixPartners, CAAM, CPCA<\/p> <\/div>\n <\/div>\n\n\n \t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t Looking at the domestic market, it is clear that Chinese players continue to dominate, as they have done in recent years. Especially for battery electric vehicles (BEVs), the following companies stand out: BYD (2.7 million units sold), GAC Aion (483,000 units sold), Geely (469,000 units sold), Chang\u2019An (385,000 units sold), Li Auto (376,000 units sold), and NIO (160,000 units sold). Only Chinese manufacturers are among the top 10 best-selling BEV brands, with one exception: Tesla with 604,000 units sold in 2023 (see figure 2).<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t Figure 2: The Chinese NEV market is dominated by mostly local players<\/strong><\/em><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t Source: Berylls by AlixPartners, CPCA<\/p> <\/div>\n <\/div>\n\n\n \t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t At the same time, the success of Chinese OEMs can also be seen on foreign markets. The export volumes of Chinese OEMs have increased massively in recent years for both types of drivetrain. The total export volume has increased by >400% since 2020 and grew very strongly by 65.3% year on year in 2023. While the trend can be seen in both segments, the export volume for EVs has grown even more strongly than for conventional ICEs \u2013 for example, sales of electric vehicles in China have increased more than tenfold since 2018 (2018: 140,000, 2023: 1.68 million units sold). Although Chinese OEMs have not yet made their mark in established Western markets such as Western Europe, they are determined to do so. We can therefore expect to see more activity by Chinese OEMs in such markets in the future (see figure 3).<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t Figure 3: At the same time, overseas activities have massively increased<\/em><\/strong><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t Source: Berylls by AlixPartners, CPCA, Press<\/p> <\/div>\n <\/div>\n\n\n \t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t How did this development come about? There are a number of reasons for this, the first being the acceptance of EVs among Chinese consumers. Despite the absence of buyer incentives or \u201cmoney in the trunk\u201d from the state, the majority of Chinese consumers are turning to EVs. A Berylls study with over 1,000 respondents shows that 56% of vehicle owners and 42% of first-time buyers would opt for a EV when choosing their next car. At the same time, Chinese brands are predominantly being chosen (in terms of EVs), with 46% of all car owners and 61% among first-time buyers. In a direct comparison, only 32% (car owners) and 23% (first-time buyers) would opt for EVs from German brands!<\/p> This finding is related to reason 2: The number of Chinese brands has increased significantly in recent years and at the same time Chinese brands are comparatively \u201cbetter\u201d than their foreign JV competitors. \u201cBetter\u201d means in this case: the customer gets more (functions and technology) for less money.<\/p> And a lower price is the third reason. An unprecedented discount battle took place in 2024. Driven by Tesla\u2019s price cuts for the Model 3 and Model Y, Chinese OEMs lowered their prices significantly. Foreign OEMs\/JVs also followed suit, as can be clearly seen from the example of the ID.3 made by SAIC-VW. ICEs are also affected by this, with the FAW-Audi A4L starting at less than EUR 30,000.<\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t<\/a>\n\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t<\/a>\n\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t\t\t\t\t\t\t\t<\/a>\n\t\t\t\t\t\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t