Financial Times: China's luxury car unabated

Younger drivers should not be alarmed at the increase in sales of luxury cars. More and more Chinese young people are driving luxury cars. They are 80, only children, have a good education and have a stable job. The house does not need to be considered, and parents do it for them. After working for a few years, I have a good salary. They may not necessarily be rich second generations, but they may live in middle-class families. They grow in a relatively rich environment and stress quality of life. When buying a car, “entry-level” luxury cars like Mercedes, BMW, Audi would otherwise be their first choice.

In the first half of this year, sales of Audi, BMW and Mercedes-Benz were 141,000, 121,600 and 95,000, respectively, an increase of 28%, 60.8% and 59% respectively year-on-year.

The contribution of the entry models of the three German luxury car manufacturers is increasing – the sales of the BMW 3 Series reached 23,552 units, an increase of nearly 30%; the cumulative sales of the Mercedes-Benz C-Class cars from January to June this year increased by 10.4% year-on-year; the Audi A4L cumulative It sold 35,781 vehicles. In June, it also updated the sales record for the best single month by 8213 units. Since its launch in January 2009, the Audi A4L has sold more than 128,000 vehicles.

Luxury car brand suppliers seem to see this emerging market with a huge number of bases. From these two years they have given themselves a young symbol to bid farewell to the old image – you know, until 2008, these luxury in China The majority of car owners are "elderly people" over the age of 50.

Before 2008, executive-level luxury cars such as the A6L, Mercedes-Benz E-Class and BMW 5 Series accounted for more than 50% of the total luxury brands, and entry-level luxury brands such as Audi A4, Mercedes-Benz C and BMW 3 Series, with a market share of less than 20%. . "At that time, Chinese consumers favored more spacious executive-class cars," said Audi President Steader.

As early as four or five years ago, when interviewing BMW President Shi Dengke, he was also afflicted with this ratio: BMW's most expensive 7-segment car sold the best in China, followed by the 5th and 3rd. This kind of “inverted triangle” consumption structure is not conducive to the cultivation of “user groups”. According to the development logic of foreign markets, the 3 Series owners will choose 5 lines when they change trains, and so on, and the market will show an endogenous development trend.

Through these two years' efforts, the consumption structure of luxury cars is changing as manufacturers hope. According to industry insiders, from 2013 onwards, the total market volume of entry-level luxury brands will be tied to executive-level luxury cars. After 2015, this market segment will become the largest market share contributor to luxury brands.

"Near Sinification"

In the first half of the year, the sales of general passenger cars was 6.64 million, which was only 5.3% higher than the same period of last year, far below market expectations. Only luxury cars have risen in contrarian directions, an increase of 40%.

According to analysis by Xu Changming, director of the Economic Information Center of the National Information Center, there are five reasons for the current hot sales of luxury cars: First, the rapid growth of wealthy people; Second, entry-level luxury cars are getting closer to the people; Third, Chinese consumers have high-end consumer goods. The strong preference, the fourth is the arrival of the transfer peak, and the fifth is the extension of the luxury car marketing network.

First of all, from the aspect of exterior design, luxury cars have abandoned the original style that has remained unchanged for many years. Younger fashion designers have been added to access younger consumers. Especially in emerging markets like China, they will focus on moving eastwards, even at the expense of specialization. Designed and developed new models for China.

On July 21 this year, the world’s fifth Mercedes-Benz advanced design center was unveiled in Beijing. It will work closely with Mercedes-Benz’s other four design centers – Germany, Italy, Japan and the United States to collaborate on the development of future models of Mercedes-Benz. . In the past two days, Audi also announced the establishment of a Chinese design studio in Beijing. The studio is mainly responsible for integrating Chinese elements into Audi's global design. BMW also plans to establish a design center in China.

The price cuts are another means of luxury cars seizing the market. Not long ago, a colleague who had worked less than five years ago had opened a Mercedes-Benz C-CLASS from Zhejiang. “It took only 230,000 yuan, and it dropped 80,000 yuan,” he said.

As luxury cars compete for entry-level products, entry-level models often play a "price butcher" role in the automotive market. Because in the past these vehicles were originally much higher than the European and American market prices, in the long term price convergence is an inevitable trend; In addition, the domestic automobile market to choose the brand, models rich a lot more than a few years ago, the consumer mentality Also more rational, luxury cars will lose some of their market share without sacrificing part of their profits, so they invariably choose to cut prices.

In addition, luxury placards are also penetrating into the lower market. For example, BMW introduced the 1 Series and MINI two years ago, Mercedes-Benz Smart prices drove straight into the 100,000 yuan range. It is not difficult to see that luxury brands rely on high-end models to gain a foothold. They are spreading out a long net. Their product lines are constantly growing, taking food from top to bottom, firmly pinning themselves to the Chinese market and allowing the market to oscillate. Will definitely be thrown off the horse.

"Appetite is still bloating"

In April 2011 Shanghai Auto Show, many luxury cars were sold out on site. The German "Le Monde" screamed that "China's luxury car has grown unabated." Rolls-Royce CEO Mill also lamented: "China's luxury car consumer market we can not see the end."

Last year, JP Morgan issued a forecast report saying that the market share of luxury cars in China “will increase dramatically”. By 2015, sales will reach 1.1 million units. "Financial Times" speculates that in 2015, China will reach the peak of the global waste consumer market, and China's luxury goods consumption will account for 32% of global market share in 2015.

The Chinese market, especially the luxury car market, continues to expand, and luxury car giants have accelerated their pace of expansion in China.

Daimler Group's Mercedes-Benz Investment and its Chinese partner Beiqi have just signed a 2 billion euro investment framework agreement for the production of several compact passenger cars and mid-size luxury off-road vehicles GLK, the construction of an engine plant and the establishment of an R&D center. And Beijing’s Mercedes-Benz’s engine plant has officially started construction and will achieve 400,000 to 500,000 capacity in 2015.

Audi completed its first million transcripts in 22 years in China last October. It is ambitious to announce that “the next million vehicles will be completed in three years.” In this year's heavy volume growth, Audi has put forward a new goal - the target sales of 700,000 units in 2015, and will introduce the entire series of models into the Chinese market Sales.

BMW accelerated the expansion of its production capacity. As early as April, BMW took the lead in declaring a capital increase plan. The investment in the second plant of BMW Brilliance increased from 560 million euros to 1 billion euros, enabling the new plant to have an annual output of 200,000 vehicles. Capacity. This also means that BMW will have 300,000 vehicles in China by 2012.

“The market share of foreign luxury cars can reach 30% to 40%. At this stage, the market share of luxury cars in China only accounts for 6% of the total number of passenger cars. What do you think of our future market?” A luxury in Guangzhou The car dealer asked the reporter.

(Note: This article only represents the author's own point of view. The author is a senior financial media person and has worked for such media as "New Weekly" and "Southern Weekend". Now he is the editor-in-chief of "The Southern Metropolis Daily".