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Discussion Starter · #1 ·
August 25,2008

Since the beginning of 2008, with raw material costs and oil prices rising constantly and “made in China” moving into cooler weather, the Chinese car market has caught a cold and domestic brands are the biggest sneezers.


Market share for China’s own brands grew from 21.7% in 2001, to 26.6% in 2006, and up to 29.6% in the first three months of 2007. But since the second half of 2007, their share has dropped to 25.8% in the first three months of 2008. In July, Chery’s domestic and international sales amounted to about 22,800 units, a fall of 39.88% over the previous month.


During this period, the market share for Japanese cars was 29.3%.


Overseas exports of some automakers have not been largely affected. Brilliance Auto gained big overseas orders last year, and has steady sales channels and prices that have been accepted in overseas areas. Ambitious Brilliance even means to attend the 2009 Detroit Auto Show. Now it is working to get local accreditations to prepare it for the entry into the US market. “If Brilliance automobiles can enter the US market, it will not only improve the company’s overseas reputation, but also help to promote domestic sales,” a company’s spokesman claims.


In the first half of 2007, Chery’s automobile exports reached 83,000 and continued to hold its No.1 ranking in China. Chery hopes that the strong performance of domestic brands in overseas markets will stimulate the domestic market.


Such hopes may be overly optimistic. The market share decline of these brands is due to a number of reasons, the most important being the abandoning of independent R&D and over-concentration on short-term interests. Domestic automakers commonly use a large amount of components made by foreign-invested producers. This mode of operation puts a damper on their future.


As yet no Chinese automaker has been able to mass produce automatic gearboxes. Some automakers have even abandoned independent R&D in this area, and hope to overtake multinational enterprises by directly transferring to the development of electric cars or new energy source automobiles. All domestic automakers now have to buy gearboxes from foreign producers.


Although every domestic automaker claims it carries on engine research, a key technology, in fact, of the over 100 domestic carmakers only seven get their engines from inside the company or the company group as multinational companies in Europe, US, and Japan do. Among the rest, 35 purchase engines from both inside and outside the company, while nearly 60 source from outside the company. Even large domestic makers such as Chery and Geely source engines from other companies, as it saves them time and money. Chery’s ACTECO engine is considered to be another form of outsourcing, and is still some distance away from a viable technology. Geely’s “reverse development” is regarded as merely another form of technology purchase.


Domestic automakers have also pursued rapid development by making use of overseas companies’ design and services, and China’s car component industry has been built by foreign-invested automakers. Even as the domestic brands’ market share inches towards 30%, they still face a lack of technology for key components.


Domestic automakers began mass-producing cars in 2000 or so, and gained the power in the market by making full use of the integration of the global industrial structure. But this model, depending on outsourcing and integration, can’t support enterprises for long.

http://www.chinastakes.com/story.aspx?id=615
 

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Discussion Starter · #4 ·
You are right, even now the mainlanders now lost all faith in Chinese brands, many Chinese on Chinese forums now say they don't know if they can still trust national brands anymore after the milk scandal.
 

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Discussion Starter · #7 · (Edited)
Hello there, first of all Welcome to CCF, nice to see you contribute to the forum..., I saw your introduction, you're from India, nice :)

But

From what I see, Indian cars are not that bright either, I have seen a few pictures of the Tata cars like the Tata Indica, and the interior looks very......

I know the two biggest Indian cars brand is Tata and Mahindra but their products are not competitive at all in foreign markets, they are doing very badly in places such as South Africa even against Chinese noobs like GWM and Cherys and those two just recently came to South Africa (Including analysis report from South African motor experts) . And from what I heard is that Tata is no longer in the Caribbean Island, where they got a bad reputation and was forced to withdraw.

I don't intend to put down Indian cars or say anything but from what I see is that Tata and Mahindra are very old age but they cannot even compete on the world stage yet. But if one looks at Chery on the other hand, they are just 10 years-old but already expand in numerous country, seriously I am not hyping on Chery or Chinese cars, they really have a lot of shortcommings ....

But when I draw some comparisons between a 48 years-old Tata Motors and a 10 years-old Chery Automobile and their achievements, I am usually lost in confusions. How can a 10 years old company is already moving on to hybrid cars, new alternative fuel vehicles, overseas factories expansion one after another and sales, dealer networks expanding , whereas the old age 48 years old company even had the mind to develop the world's cheapest car , and with a record of plummeting sales abroad, and I do not want to go into Mahindra a 63 years old company, their record looks even gloomier.

But I really admit the reputation of Chinese products, it is a a general perception that we cannot deny.
 

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Discussion Starter · #12 · (Edited)
uh Chery cars in some countries already provide warranty, either mileage or years. Chery offers warranty in Malaysia.

Chery does not offer warranty in Singapore ?
 

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Discussion Starter · #13 ·
I did not mean to badmouth or compare Indian cars to Chinese cars. I know that Chinese makers still have a lot to learn. But at least people like Chery, BYD, Geely and Lifan are making progress in new designs, technology and safety improvements. But there is no room for hype here.

What I don't understand is why the Chinese government allow so many small auto makers to sprout up like mushrooms these days.
 
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