Once-dominant foreign car brands vow comeback in China
Global carmakers, including Toyota and Volkswagen, took to the stage at the Shanghai auto show on Tuesday with built-for-China and electric-drive products in a high-stakes bid for a comeback in the world's biggest market.To get more news from shanghai china, you can visit citynewsservice.cn official website.
But after a year in which trends have shifted sharply against the established foreign brands that once dominated China, executives from Chinese automakers offered a reality check: the game is moving faster and the pressure to cut prices is intensifying.
Volkswagen said at the show it would introduce 10 more electric models by 2026 and cut the time it takes to develop new models by almost 40 per cent to keep pace with faster-moving Chinese rivals.
"Our guiding principle is development in China for China at full speed," said VW brand boss Thomas Schaefer.
Toyota, which has been slow to embrace electric vehicles, used the Shanghai show to unveil two new EVs, doubling the number of its mainstream brand on offer in China.
It also unveiled a Lexus-branded minivan, the "Luxury Mover", a hybrid designed to be chauffeur-driven, a preference of many Chinese luxury car buyers. The LM will also be sold in Europe and China, Lexus said.
In a sign of the turnaround, BYD outsold both Toyota and VW-branded vehicles in China in the first quarter.
On Tuesday, BYD launched a hatchback-style EV, the Seagull, aimed at the small car market that Toyota has long dominated with models such as the Corolla, a global best-seller. The Seagull will start at the equivalent of just over $11,000.
"What moves Chinese customers today will move the world tomorrow," said BMW CEO Olivier Zipse at the show.
Chinese car executives underlined the pace and pressure to cut costs in a market where electric cars now account for almost a third of new sales.
Zhu Jiangmin, CEO of privately held Leapmotor, made a bold prediction about how low prices could go, a promising notion for consumers but a threat to carmakers.
Within a decade, he said, China would be able to sell an SUV-style EV with a battery range of 400 km (249 miles) for around $7,500.
Tesla's Model Y, the EV maker's best-selling car worldwide ahead of its Model 3, is estimated to have a range of 545 km in China but starts at nearly $40,000 in the country.
Tesla opted to skip the Shanghai auto show this year after facing backlash from Chinese consumers and some of its early fans for not introducing new models and features more quickly.
The company reports its first-quarter results on Wednesday, when the focus will be on how much its discounts in China and other markets are eating into its profit margin.
"The real situation is that the Model 3 was competitive in 2018, but it's not so competitive today, and it's normal for them to cut prices," Nio founder William Li told reporters. "You can get better cars for the same price in China."
