The big three much stalled in China

15 November 2019

A second consecutive failed year in the Chinese auto market promises to American manufacturers a big problem

Due to the fact that the new car market in China is expected to second consecutive annual decline, the American brands are faced with new challenges.
Resource of China Automotive News writes that Detroit is losing its share in the Chinese market, at the same time, faced with growing pressure from regulators to increase the efficiency of cars with internal combustion engines and the requirements of the increased production of electrified vehicles.

Reduction of shares
In light of the fact that Volkswagen and the leading Japanese brands Toyota and Honda accelerate the production of fundamentally new products, Chevrolet, Ford, Jeep and other American brands at an alarming rate losing out.
So, in 2018, the combined share of American brands in the Chinese market for new cars fell to 10.5% versus 12.3% in 2017.
According to the China Association of automobile manufacturers (CAAM), during the first 10 months of this year their combined market share has fallen to 9.5%.
General Motors, Ford Motor Co. and Fiat Chrysler Automobiles (FCA) does not reveal its monthly sales in China. However, the sales results of their local partners show that, although the rate of decline in the overall market for new cars and slowed down, but the decline in the sales of the American brands so it is not slowed down.
In October, sales of new passenger cars in China fell by 5.8% to less than 1,93 million.
Thus, for example, sales of SAIC-GM – a joint venture with General Motors concern for the production of SAIC passenger vehicle, which has been producing and selling car brands Buick, Chevrolet and Cadillac – have fallen by 25% to 136 820 units.
Car sales of Ford brand produced by two joint venture – Changan Ford and Jiangling Motors Corp. fell by 12%, to less than 27,000 units of the two joint ventures account for the majority of sales of Ford Motor Co. in China.
October sales of the Jeep brand fell by 42% to 5432 units, according to a local partner of the concern FCA – company GAC Motor Co.

Pressure standards
Continuing to lag behind the market in terms of sales, U.S. brands are still lagging behind in the implementation of the mandatory for China's standards for fuel economy and expansion of production of electric vehicles and hybrids.
According to Chinese regulations, all automakers operating in the country should reduce by 2020 the average fuel consumption in its model line (similar to the 40-year-old American norms CAFE – ed.) to 5 liters per 100 kilometers (47 mpg) against 6 liters (39 mpg) permitted in 2016. They should also further reduce fuel consumption under 4 liters per 100 kilometers (58,8 miles per gallon) for new models of automobiles, master the production.
However, it is GM, Ford and FCA (the latter is produced in China only Jeep vehicles) in 2018 was among the 10 worst brands in terms of fuel economy, according to the Ministry of industry and information technology, the main regulator of the Chinese automobile industry.
Beijing also introduced "carbon credits" to push manufacturers of passenger vehicles to increase the production of hybrids (HEV and PHV) and electric vehicles (BEV). According to the plan, only "operationalise" electric cars and hybrids collected in the country are eligible for carbon credits.

Electric vehicle Buick Velite 6 EV

However, GM, which last year sold almost 2 million cars of the brands Buick, Chevrolet and Cadillac offers in its product line for the Chinese market only two localized models electrified – electric vehicle Buick Velite 6 EV and PHEV, Cadillac CT6.

Hybrid sedan Cadillac CT6

In contrast, the VW Group is the main competitor to GM in China, already has six electrified models locally, including three electric vehicle and PHEV under the VW brand, as well as a hybrid version of an elongated sedan Audi A6.
Like GM, Ford also has only two products in the segment of PEV – electrocreaser the Ford Territory and the PHEV version of the Ford Mondeo sedan.
Among the four models of Jeep that FAC manufactures in China: Cherokee, Renegade, Compass and Grande Commander – in hybrid version of the Grand Commander refers to electrified products.

The hybrid crossover Commander Jeep Grande PHEV

If the FCA has not yet shared plans for restoration of its activities in China (of course, they did not before – now there are negotiations about a merger with PSA – ed.), then GM and Ford plan to release many new products.
In October 2018, GM said that by 2023 will release to the world market 20 models of electric cars, many of which will be sold in China. And in April, Ford announced that over the next three years, will introduce more than 30 new and upgraded models, including not less than 10 electric vehicles, under the brands Ford and Lincoln.
If the Big three and not be able to accelerate the introduction of new and upgraded models, especially energy saving lamps and electrified, the prospects of American brands in the Chinese market will continue to shrink as the soap bubbles..