Chinese car companies have witnessed an expansion in the global markets, especially in the countries of the south, where companies such as “BYD” and “Geely” exceeded Western companies in terms of exports, so the size of Chinese exports reached 4.7 million cars in 2023, driven by increasing the production of internal combustion engines, not Electric cars only.
The British “Economist” magazine said in a report that in 2009, the Chinese “BYD” was evaluated at the Detroit Motor Show, and the performance evaluation came in terms of “design, building quality and finishing” disappointing, but since then, it has witnessed an industry Global cars have a radical transformation, as China has led strongly as the largest car factory in the world.
The Economist report added that despite the unpopular start, it excelled “BYD” Tesla has to become the largest producer in the world for the entire electric vehicles in size, and it also excels by a large difference when calculating the rechargeable hybrid cars.
According to a report, “BYD” contributed to the extraction of the car market share in China from foreign competitors who had previously controlled it.
BYD and other Chinese companies such as Sherry, Jelly and Sayk have succeeded in converting China into the world’s largest auto source, beating on both Germany and Japan.
Pedro Pacheko of Gartner Consulting Company says Chinese car companies are now aspiring to overthrow the Volkswagen and Toyota from the Global Auto Industry Summit.
Chinese car exports expand
According to the Economist report, the expansion of exports has become pivotal to achieving this goal for Chinese companies, as the number of cars exported from China to the outside reached 4.7 million cars last year, which is 3 times the number 3 years ago, according to City Group estimates, while it is expected that it is expected This height continues; With external sales expectations of 7.3 million cars by 2030.
The report added that the Chinese consumers had previously preferred foreign brands, but at the present time, local car companies possess about 3 fifth sales in the country.
The British magazine indicated that, in search of an alternative outlet, Chinese car companies have tended towards foreign markets, and companies such as “BYD”, Jelly Great Wall announced that profit margins of external sales are ranging from 5 to 10 degrees Celsius compared to local sales.
The share of Chinese brands in sales of electric vehicles in Europe increased from about 4% in 2021 to 10% in 2024.
Economist added that the customs duties imposed by America on Chinese exports by 100% since the presidency of Joe Biden, has already turned between the entry of Chinese electric vehicles into the American market, as well as strong loyalty to local brands in Japan and South Korea, in addition to the tense diplomatic relations with India, To keep Chinese car companies far from these markets.
Change the path to the south
The Economist report revealed that these obstacles did not deter Chinese companies, which turned their focus into Southeast Asian countries, the Middle East, Latin America and even Africa, which are markets combined more than 20 million sales.
According to the report, Russia is the largest importer of Chinese cars, especially after the withdrawal of Western car companies following the war in Ukraine, where the share of Chinese brands in the Russian market increased from 9% in 2021 to 61% in 2023, according to the “Rhodium” consulting group.
The magazine pointed out that Chinese car companies are making great progress in other markets, as they now acquire 8% of the market in the Middle East and Africa, 6% in South America, and 4% in Southeast Asia, according to the estimates of Bernstein, after it was its share Semi -years ago a few years ago.
Electric vehicles have already started to gain momentum in some unexpected places. In Latin America, these vehicles now constitute 6% of the total sales after they multiplied in 2024, according to the research company “Bloomberg Inn”, where the percentage of Brazil’s wills reached about 7% And 9 out of 10 electric vehicles there are Chinese brands, while the percentage in Mexico reached 8%, and in Thailand about 15%, and this increase is expected to continue.
Chinese factories abroad
The newspaper pointed out that Chinese car companies are not satisfied with exporting from the inside, but also seeking to establish a foothold by building factories abroad, to avoid customs duties and shipping costs and stay close to customers, as this trend leads the company “BYD” ; Which is currently making its vehicles in Thailand and Uzbekistan, and plans to establish factories in Brazil, Hungary, Indonesia, Turkey and perhaps in Mexico.
Other Chinese companies such as Sherry, Shangan, Greet Wall and Sayk also have external factories under construction.
Economist said that nevertheless, some factories may not achieve what they planned abroad, as there are indications that the Chinese government may force companies to slow down their external investments to maintain the occupancy of local factories, as well as to protect Chinese technology from intrusive eyes.
