Don't be overwhelmed by the prosperity of the surface Chinese cars are a few steps away from the giants

The data in the first half of the year began to count. From January to June of this year, China’s total production and sales of automobiles reached about 6 million vehicles, which was far higher than the 4.8 million vehicles in the United States and secured the throne of the world’s first automobile market. In spite of this, if the individual automobile company is compared with the world auto giant, the gap is still very obvious.

Let's look at sales. In the first half of the year, the top ten domestic auto manufacturers were: SAIC, FAW, Dongfeng, Chang’an, BAIC, GAC, Chery, BYD, Brilliance, and JAC. Compared with the same period of last year, except for the slight drop of FAW, All other companies have grown at different levels, with growth rates exceeding 15%. The specific sales volume was 1,217,300 units for SAIC Motor, 860,800 units for FAW and 805,100 units for Dongfeng, while Chery's own brand leader Chery sold 211.2 units for the first half of the year. After the international auto giants experienced a catastrophic market turmoil, sales have dropped dramatically year-on-year. At present, among the top 10 automotive manufacturers in the world, there are five Asian car companies, three European car companies, and two American car companies. In terms of sales volume, although Toyota Motor Corp.'s sales fell by 26% year-on-year, the sales volume still reached 3.5641 million units; GM's sales volume dropped by 21.8% year-on-year to 3.5527 million units. Even if the sales volume of Chinese auto companies soared and the sales of international auto companies plummeted, Toyota's sales were still three times that of SAIC Motor. Although the larger-scale, better-known automobile companies in the United States have been challenged, there is no certain scale. The labor price advantage of the Chinese auto industry will be difficult to exert. So from the sales point of view alone, our gap is still huge.

Look at the export again. According to the data, the performance of auto exports has been unsatisfactory in the first half of this year. In the first half of the year, a total of 142,400 vehicles were exported, a drop of 60.21% from the same period of last year. According to the data from the Japan Automobile Manufacturers Association, Japan’s auto exports fell by 59.1% in the first six months of 2009, but there are still 1.43 million vehicles. Germany's auto exports in the first six months of this year also fell by 38.05% compared with the same period of last year, and the cumulative export of automobiles was 1.5396 million. In the first half of this year, Japan and Germany exported automobiles 10 times and 11 times respectively. In fact, more than 40% of the automobile production in Germany, Japan and other countries is used for export, while the number of automobile exports in China in 2008 only accounts for about 6% of the national automobile output. The gap can be said to be not a star.

There is brand strength. Not long ago, the United States "Fortune" magazine announced the 2009 Global 500 list, there are 20 auto companies. Due to the financial crisis, the ranking of auto companies generally declined. Toyota Motor, with annual sales of 204.252 billion U.S. dollars, entered the top 10 as the tenth. SAIC and FAW ranked 359th and 385th respectively with sales revenue of 24.88 billion U.S. dollars and 21.6754 billion U.S. dollars. Toyota's sales reached eight times that of SAIC Motor. This also brought with it the problem of profits. Toyota sold only three times as much as SAIC Motor and sales were eight times that of SAIC Motor. Through simple calculations, we can know that the price per Toyota is 2.7 times that of SAIC. Another related data is that the average unit price of passenger cars sold in China is less than 100,000 yuan, while the United States is nearly 25,000 US dollars, and the average unit price of commercial vehicles that account for 18% of US car sales is as high as 100,000 US dollars.

There are many figures that illustrate the gap between us. For example, the world’s mature auto companies currently invest about 600 euros in the development of each new car, while China’s R&D investment is only 100 euros. Chinese auto companies must invest at least 300 to 350 euros in the R&D of each new car before they can compete with foreign auto giants.

Of course, the gaps listed above are facts. It is also true that the gap between the Chinese auto industry and the world autos is shrinking. The author is not here to pour cold water, but to make the auto industry better understand themselves. In the end it is a few steps away from the world-class auto giants. Don't be overwhelmed by the prosperity of the surface.

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