"Chinese're catching up!"
China and South Korea released two messages at the same time on the 18th:
On the 18th, the "China Automobile Association Data" WeChat public account released macro data saying that in 2021, China's automobile production and sales exceeded 26 million vehicles, ending the situation of three consecutive years of decline since 2018. The added value of the automobile manufacturing industry also maintained steady growth year-on-year, and the growth rate was higher than that of production and sales in the same period. According to data released earlier by the Ministry of Industry and Information Technology, China's exports of complete vehicles reached a record 2.015 million units last year, a sharp increase of 90.1% over 2020.
Yonhap News Agency reported on the 18th that a statistical data released by the Ministry of Industry, Trade and Resources of South Korea on the same day showed that in 2021, South Korea's automobile production and domestic sales both fell year-on-year, and exports increased year-on-year. Last year, South Korea's automobile production decreased by 1.3% year-on-year to 3.46 million units; domestic sales decreased by 8.5% year-on-year to 1.73 million units; and exports increased by 8.6% to 2.05 million units, the data showed.
The two countries' automobile export performance is almost flat, the above two news also makes South Korea mixed, South Korea's semiconductor, electronics, shipbuilding and other advantageous industries, is shrinking in competition with China. South Korean media reacted quickly to this, starting from the 16th continuous reports, saying that as many industries in China and South Korea have shifted from complementary relations to competitive relations, the automotive industry of the two countries may also carry out fierce competition in the international market in the future.
South Korea: Why are car exports falling?
South Korea began to build cars in the early 1960s, and a few car companies began to produce American cars in the form of CKD semi-bulk assembly. In 1973, Hyundai Motor Corporation introduced the engine, drive train and chassis technology of Mitsubishi Corporation of Japan, and in 1975 began to develop and produce its own cars, and exported them to Africa in large quantities. After entering the 1980s, South Korea identified automobile exports as a basic national policy. In 1987, the South Korean automotive industry had achieved a 20% export ratio. It was also in that year that the output value of south Korea's automobile industry reached 50% of the gross national product.
Screenshot of South Korean media report
Yonhap News Agency reported that South Korea's vehicle exports peaked at 3.15 million units in 2011, but have since begun to decline, reaching 1.89 million units in 2020, falling below the 2 million vehicle mark again after 16 years. South Korea's vehicle exports once ranked third in the world, behind Germany and Japan, but in 2016 they were overtaken by Mexico and squeezed out of the top three. In order to avoid tariffs and save production costs, companies such as Hyundai Motor in South Korea have moved a large number of production capacity overseas, which has also led to a decline in the export volume of locally produced Korean cars.
China: Why did you get such good results?
"China, which pursues the dream of a strong car, last year exported 2 million vehicles for the first time", South Korea's "Asia Economy" reported that Chinese car companies with a huge domestic demand market and gradually improved technical strength, last year's vehicle exports exceeded the 2 million mark. At the same time, despite the lack of automotive semiconductors and the continuation of the new crown epidemic, China still produced and sold 26.08 million vehicles and 26.27 million vehicles last year, ranking first in the world for 13 consecutive years.
In particular, new energy vehicles have grown by leaps and bounds in China, with sales reaching 3.52 million units last year and may even exceed 7 million this year. Some voices believe that with a huge domestic market, China is restructuring the international electric vehicle supply chain with its own country as the center. Even in south Korea's mainly promoted hydrogen energy vehicles, China has made no secret of its development ambitions. China has already trial-run 600 hydrogen electric vehicles at the upcoming Beijing Winter Olympics, and china's hydrogen electric vehicle sales are likely to reach 100,000 in 2025.
At the same time, the Chinese government has adopted a vehicle export incentive policy, and the quality level of the domestic automotive industry has been continuously improved, which has promoted the expansion of China's complete vehicles to the world. China's domestic automobile sales have been declining for three consecutive years, so it is necessary for overseas markets to digest huge automobile production capacity. A report by the Korea Automotive Research Conference last year showed that Chinese automakers are stepping up their exploration of emerging markets. From a regional point of view, Chinese car companies target Russia, Eastern Europe, Central and South America, Southeast Asia, the Middle East and other countries with small revenues but good relations with China, and the car types are mainly price-sensitive trucks or commercial vehicle markets.
In addition, Tesla of the United States, which has set up a vehicle manufacturer in Shanghai, has also helped China export vehicles. Last year, China exported 310,000 electric vehicles, of which Tesla accounted for 160,000. At present, the main driving China's vehicle exports are local enterprises such as Geely and the Great Wall, while electric vehicle manufacturers such as Weilai and Xiaopeng are also actively exploring the European market. Some analysts believe that as the world is about to enter the era of electric vehicles, China's vehicle exports will continue to increase in the future.
Germany: Chinese are catching up
In addition to South Korea, Germany, another big car country, has also been keeping an eye on its Chinese auto peers. "Chinese're catching up!" Dexin News Agency reported on the 16th that the latest report released by the CAM Automotive Research Institute in Bergisch Gladbach, Germany, said that German automakers are still in a leading position in innovation, but Chinese automakers have made the most progress and are increasingly catching up with industry leaders in the world market. The report compares innovations in the range of models from more than 80 car brands since 2016. The results show that Volkswagen, BMW and Daimler remain in the top three of the world's most innovative automotive groups. Closely following the three major German car companies is Tesla, which is particularly prominent in its innovations in range and driver assistance systems. Fifth to seventh places are Hyundai, Ford and Stellantis. Japanese manufacturers have lost their innovative prowess, with Toyota only ranking 13th.
Most notably, three chinese automakers are in the top ten. BYD's Innovation Index improved by 303%, from 20th in the 2016/2018 cycle to 8th in the 2019/2021 cycle. The Great Wall rose 164 percent, climbing from 18th to 9th, while Geely slipped from 6th to 10th.
Bratzel, an expert at the CAM Automotive Research Institute, said that BYD's rise is mainly through a wide range of electric offensives, producing a large number of pure electric vehicles in various market segments. The rise of the Great Wall has relied heavily on new technologies such as gesture-based automatic parking. As the global automotive industry enters the era of electric vehicles, Chinese car companies and Teslas with strong innovation capabilities will launch greater challenges to established manufacturers in the future.
Source: Cargo Farming, author Zhang Jing Aoki