The Truth About Cars » sales 2010 The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. Fri, 25 Jul 2014 10:00:11 +0000 en-US hourly 1 The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars no The Truth About Cars (The Truth About Cars) 2006-2009 The Truth About Cars The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars » sales 2010 China Car Market 101: Who Makes All Those 18 Million Cars? Wed, 19 Jan 2011 13:09:27 +0000

If you want to get ahead in the car business, this is required reading. If you just like cars and don’t give a hoot about who makes them where and why, then you may skip this.

Are we entre nous? Now that China is the world’s largest car market, and most likely will be for quite a while, we need to learn how that market works. At least in a rudimentary way.

Let’s start with the numbers. All numbers in China are big. No numbers in China (with the exception of telephone numbers) are totally correct. The country is just too big. They don’t even know how many Chinese live in China. Those 1.3 billion are just a guess.

Don’t trust any car related number out of China unless it comes from the China Association of Automobile Manufacturers (CAAM). The Chinese follow the model where all manufacturers report to their association, the association consolidates the numbers. It’s not that the CAAM is infallible. But at least they are consistent.

How many car manufacturers are there in China? Nobody really knows. The guess is around 120. Brands? A dizzying number. Even small manufacturers want to be like GM and have a number of different brands. They’ll learn soon enough.

Who are the biggest manufacturers? Now it gets interesting. Chinese manufacturers don’t think it’s strange to have joint ventures with bitter rivals. SAIC has joint ventures with bitter rivals Volkswagen and GM. FAW has joint ventures with bitter rivals Volkswagen and Toyota. FAW and SAIC are bitter rivals also. They have different cars from the Volkswagen range. If you want a Jetta, you have to go to a different dealer than if you want a Passat.

As for the numbers, here is what CAAM reports:

China‘s 10 largest car manufacturers
Name Units 2010 Growth 2010
SAIC 3,558,400 31.53%
Dongfeng 2,724,800 36.05%
FAW 2,558,200 31.55%
Changan 2,378,800 27.22%
Beijing Auto 1,489,900 19.86%
Guangzhou Auto 724,200 13.74%
Chery 682,100 36.33%
BYD 519,800 15.93%
Brilliance 501,400 43.94%
JAC 458,500 42.46%
Total 15,596,100
Market share 86%

The 10 largest manufacturers (not brands) own 86 percent of the total market. Where are GM, Volkswagen, Toyota etc? They are in there, somewhere.

Let’s try breaking them out. The CAAM tally for passenger vehicles helps. A bit.

China‘s 10 largest passenger vehicle makers
Name Units 2010 Growth 2010
SAIC-GM-Wuling 1,135,600 16.26%
Shanghai GM 1,012,100 42.87%
Shanghai Volkswagen 1,001,400 37.50%
FAW Volkswagen 870,000 30.01%
Chongqing Changan 710,000 36.93%
Beijing Hyundai 703,000 23.27%
Chery 674,800 34.87%
Dongfeng Nissan 661,000 27.37%
BYD 519,800 15.93%
Toyota 505,900 21.24%.
Total: 7,793,600
Market share: 57.00%

See what I mean? To get to the 2,351,610 units GM reported for 2010 in China, you need to add Shanghai GM and SAIC-GM-Wuling. You won’t get quite the 2.3 million when you do that. Did I mention that numbers are an inexact science in China?

To get the Volkswagen number, you need to do the same with FAW Volkswagen and Shanghai Volkswagen. Gives you a total of 1,871,400 units. Also not quite the 1.92 million Volkswagen reported for China. Why the difference? Imports and exports. Makes your head spin, doesn’t it?

Anyway, China’s 10 largest (which are actually China’s 8 largest, just not from the Chinese view) sold some 7.79 million passenger vehicles in 2010. They own 57 percent of that market. The other 43 percent are owned by the other 110 manufacturers.

The math wizards will take a look at this and grumble: “Hold it right there! 7.79 million. 57 percent share. That comes to a total market of only 13.67 million! Didn’t they say they had more than 18 million?”

They sure did. Remember that about half the cars in the U.S. aren’t cars, but “trucks”? Well, some 4.3 million “commercial vehicles” changed hands in China. We’ll spare you the breakdown of who made those. If you are interested, you can read it here.

When you add-up the passenger vehicles and the commercial vehicles, you come to a number slightly below 18 million. Where are the 18.061 million, you ask? Come on, you are in the land of the big rounding error. And again, imports.

So there. It wasn’t that hard. A bit confusing, maybe. But with a little work, you’ll get the hang of it. Next time someone says China sold 13.6 million cars, you can now say: “Are you referring to total motor-vehicle count in 2009 or passenger vehicles sold in 2010?” See, you are already an expert!

How is your Chinese coming along?

]]> 5
Volkswagen Sells Nearly 2 Million CARS In China Fri, 07 Jan 2011 14:36:22 +0000

A few days ago, we mentioned that Volkswagen might have something to say about GM’s press release which claimed that in 2010, “Shanghai GM became China’s first passenger car maker to sell 1 million vehicles annually.”

Today, Volkswagen said something, without even mentioning GM.

Volkswagen, which operates car ventures with Chinese state auto groups SAIC Motor and FAW Group, sold 1.92 million cars in mainland China and Hong Kong in 2010, up from 1.40 million a year earlier, Reuters reports.

We said a few days ago that “VW is expected to have sold a little bit less than 2 million passenger cars in China,” and VW did not disappoint.

Volkswagen sold 37 percent more vehicles in mainland China and Hong Kong. Compared with arch rival GM, Volkswagen either gained or lost market share in China, it depends how you look at it.

Compared to the big Chinese GM that sold 2,351,610 units last year (including more than a million Wuling delivery vans), Volkswagen gained market share. Big GM grew 28.8 percent, while Volkswagen grew 37 percent.

Compared to the small GM, a.k.a. Shanghai GM which sold 1,033,307 Buicks and Chevys, Volkswagen lost market share. Small GM gained 42 percent.

See, it’s a matter of perspective, and we’ll find enough perspectives to make everybody happy.

The Volkswagen number is impressive, given the fact that it’s all passenger vehicles and that Volkswagen could not make the number of cars the ravenous market demanded. In China, Volkswagen was capacity constrained for most of the year.

To fix that, they will drop serious money into China. Volkswagen will invest $13.8 billion in the country through 2015, earmarked to expand Volkswagen’s production capacity (two new factories) and to develop new products.

Wuling sales had been a bit lame recently. Once all that new VW capacity comes on-line, Volkswagen could outsell even “big GM” in China.

]]> 2
It’s Official: GM China Bigger Than GM U.S.A. Wed, 05 Jan 2011 15:59:31 +0000

GM China’s 2010 sales numbers did not disappoint. They expected more than 2.3 million cars for 2010 sold in the Middle Kingdom,  they got more than 2.3 million. 2,351,610 units, to be exact, up 28.8 percent compared to a very strong 2009. to a record in 2010. GM is the first global automaker to sell more than 2 million vehicles in China in a single year. And here is the breakdown:

  • Shanghai GM ended 2010 with domestic sales of 1,033,307 Buicks and Chevys sold, up 42 percent.
  • The SAIC-GM-Wuling joint venture contributed 1,226,860 delivery vans, but less growth: Wuling sales grew only 15.6 percent for the year, but they hold about 40 percent of China’s mini-commercial vehicle segment.
  • GM’s new light-duty commercial vehicle joint venture, FAW-GM, sold 88,224 trucks in China in its first full year of doing business.

In 2010, GM sold 543,709 Chevrolets (up 63.4 percent), Buick sales rose 23 percent to 550,010 vehicles sold in 2010. Even Cadillac reported record sales: 17,366 units in 2010.

With these numbers, China is not only the world’s, but also GM’s largest auto market. GM sold  2,11,699 units in the U.S., and 2,351,610 in China.

GM’s press release says that “Shanghai GM became China’s first passenger car maker to sell 1 million vehicles annually,” something Volkswagen might contest. No VW numbers are out yet, but VW is expected to have sold a little bit less than 2 million passenger cars in China, albeit across two joint ventures, FAW-VW and SVW. The Chinese partners of both are also GM joint venture partners, so complaints from there.

]]> 12
China Will Have The Mostest This Year Tue, 30 Nov 2010 09:48:10 +0000

The year is slowly coming to an end. Only one month to go. China’s industry association CAAM is no doubt looking at early reports of the November sales (official numbers will be released in a week or so.) That look emboldened the CAAM to come to a semi-official prediction: “China is expected to record auto sales volume of more than 17 million units this year” said the China Association of Automobile Manufacturers (CAAM), according to Gasgoo.

Still hedging a bit, aren’t we? Well, J.D.Power already predicted that China’s auto sales for 2010 will be around 18m this year. But then, the  CAAM said “more than 17 million,” right?

It definitely looks like China will take away the “most automobiles sold in a year in all times” record this year, held by the U.S. for what seems to be eons.

While we are citing predictions:

The CAAM cautiously predicts that China’s auto sales volume “is expected to exceed 25 million units by 2015.” How much, they don’t say.

Further in the prediction department, China’s dependency on imported oil is expected to rise from 50 percent to 60 percent or higher with the increase in domestic auto sales. There it is again: “Or higher.”

]]> 3
17 Million Cars A Year In China? Forget About It Sat, 27 Nov 2010 18:00:23 +0000

People have accused me of irrational exuberance (or worse) when I mentioned that the Chinese auto market could be 17 million or thereabouts this year. Impending bubbles were predicted. Popping bubbles were (erroneously) reported. Gordon Chang, guest of Glenn Beck whenever Beck needs an Asian that says something nasty about China, even offered the theory that the Chinese government  secretly buys most of the cars and hides them somewhere. (For 17 million, the Gobi desert would come in handy, but then there’s Google maps.)  I stuck by my prediction of 17m or thereabouts.

Well, it turns out I was wrong after all.

J.D. Power, echoed by Automotive News [sub], now predicts that auto sales in China (all vehicles, they don’t have the “light vehicle” category) will grow more than 30 percent to 18 million units this year.

It sure looks that way.

In October,  sales were up 27.1 percent for the month. For the first ten months, auto sales had risen 34.76 percent to 14.68m units and production was up 34.49 percent to 14.62m.

J.D.Power calculated the October SAAR for China (which they don’t have, be careful with that word, they might think it’s SARS) at 19.2 million units.

J.D. Power sees the same trend we reported weeks ago: The Chinese government keeps its people guessing as to what will happen with car taxes and other incentives in the new year. Many Chinese decide to lock in the handouts this year instead of hoping for an uncertain future.

China already stepped on the brakes to avoid an overheating of the economy. Therefore the thinking is that the handouts will end in the new year. Which has the reverse effect of further overheating the economy as people mob the showrooms.

If J.D.Power’s projection will come true, then a world record will be broken. The U.S. had sold more than 17 million cars in the beginning of the millennium, but never more than 18 million. Currently, the U.S. is seen to close out the year with sales of 11.5 million.

In 2011 and beyond, J.D. Power expects China’s auto market “will grow at a somewhat lower rate than in 2009 and 2010.” Now that’s a precise prediction! My gut says it will be somewhere between 10-15 percent. Why? Because the Chinese get nervous when growth dips below 10 percent. And mostly because China has a vehicle density of only 63 per thousand (U.S.: 800 per thousand.)  Lots and lots of room to grow in a country wil a population of 1.3 billion (which will mostl likely turn out to be 1.5 billion when they are done counting thise year’s census.)

Run the numbers: At just 15 percent growth, it will be 21 million cars next year and 36 million a year in 2015. That should be enough to make those happy who had the foresight to enter the Chinese market. GM comes to mind. And speaking of GM,  GM China’s CEO Kevin Wale agrees and also predicts 10 to 15 percent growth for next year.

]]> 18