"One Belt, One Road" countries along the car market is unique
The “Belt and Road” summit brought the world's attention to China. Economic and trade, cultural exchanges, etc., provide new opportunities and challenges for Chinese manufacturing and Chinese wisdom. The auto industry is also in the construction of the "One Belt, One Road" initiative, contributing to Chinese manufacturing and export overseas. The 65 countries along the route and convergent countries all over the world will adopt the "Belt and Road" and become the next step in the development of the automobile industry. How to conform to local characteristics and become a favorite car for local consumers is also a subject that Chinese car companies must learn.
Iran
As an important country in West Asia, Iran played a role as a bridge between China and the West as early as the ancient Silk Road period. Today, Iran is playing a unique role in the construction of the "Belt and Road" with its rich historical, economic and cultural resources.
Located on the coast of the Persian Gulf, oil and gas resources are quite abundant. This provides strong resource support for the construction of the entire One Belt One Road and the development of Chinese companies in Iran. This also helps the landing of China’s automobile industry. In addition, Iran is a member of the “One Belt and One Road” initiative. The important node countries in the United States are an important link connecting the Eurasian Continental Bridge. The combination of land and sea transportation has also become an important support for Iran’s development of the “Belt and Road”; market groups that have not yet been fully developed, and bilateral friendship between China and Iran. The relationship has become the foundation for Chinese companies to successfully take root in Iran.
These are also opportunities for Chinese car companies to take advantage of the “Belt and Road” initiative to go abroad and enter Iran. The survey shows that according to the classification rankings of news views of various websites in Iran, news and reports about cars are definitely one of the most viewed types. One of the most frequently discussed topics in Iran is cars. Iran is an absolute auto power. Almost every family has more than one car. At the same time, open and trendy young people are also an important car consumer group in Iran.
Most of the streets in Iran are not spacious, coupled with the considerable number of cars on the road and the undulating terrain, so that Iran is also facing the problem of traffic congestion. The smaller, convenient, and better-operating models are more suitable for consumers. At the same time, Iran, located in West Asia, suffers from the dry and high temperature climate all the year round. How to overcome the climate problem and improve the comfort of consumers has also become a consumer's consideration. Chinese car companies that are committed to overseas markets must, of course, grasp the fate of consumers.
In 2016, the annual sales of Iranian cars reached 1.4485 million units, and sales continued to increase. PSA, which performed poorly in China, continued to sell well in Iran due to local production, and it has almost become the favorite model of the Iranian people. In addition, "Made in China" cars also play a very important role. Among the top ten brand cars in the Iranian auto market this year, the three independent auto companies are on the list, namely Chery, Brilliance and Lifan. Among them, Iran is the best performer among all Chery's overseas deployments.
As the first Chinese passenger car brand enterprise to enter Iran, Chery Automobile seized market opportunities after being familiar with Iranian consumers, and successfully started cooperation with Iranian Modylan Automobile Manufacturing Co., Ltd. and subsequently successfully acquired the company. Thus taking root in the Iranian market. Currently, Chery has become Iran's largest foreign-owned automobile company. In addition, a large number of Chinese car companies such as Geely and Jianghuai are very popular in Iran, and Sinotruk’s large and medium-sized trucks also occupy a certain market, gaining the attention and praise of Iranian consumers, and allowing Chinese cars to prosper in the Iranian market. .
Russia
Russia is a key country on the northern route of the “Belt and Road”, one of the single country markets with the largest market size and potential, and one of the countries along the “Belt and Road” that has in-depth cooperation with China.
The vast land makes Russia extremely rich in oil and gas resources, making machinery, metallurgy, oil, natural gas, coal and chemical industries very developed.
In the eyes of ordinary Russian consumers, the ticket in their hands is the most important: Although Russia is rich in oil resources, the most important thing for consumers when buying a car is fuel economy. As Russia is located in the northern part of the Eurasian continent, part of the country is within the polar circle. The high-cold climate makes automobile fuel consumption a problem that consumers must pay attention to, followed by hardware issues such as car comfort and power in cold conditions. Similarly, cost-effectiveness is also an essential consideration for consumers to buy a car. In addition, the cold weather and snow-covered roads make cross-country and other vehicles more suitable for Russia's extreme climatic conditions.
However, in recent years, the decline in international crude oil prices and various political factors have made Russia's overall economic situation not good, which has also directly affected the Russian automobile market. Since the beginning of the global financial crisis in 2008, and due to a series of political influences such as the Ukraine crisis, the Russian auto market has declined for four consecutive years, and automobile production and sales have fallen year by year. The sales volume in 2016 was 1.445 million vehicles, a year-on-year decline of 11%. Chinese self-owned brands fell more sharply in Russia in 2016, with a decline of 21.4%.
Even though the overall situation of the auto market is not good, for this sparsely populated country, cars are often a necessity for travel. The European Chamber of Commerce AEB believes that the Russian auto market in 2017 is hopeful to end the decline, and the overall market sales are forecast to reach 1.48 million vehicles. Affordable small cars are the favorite models of Russians, and the local small car brand Lada is one of Russia's best-selling models. Policies and the fall in the ruble have had a great impact on Chinese car companies, but what is unexpected is that the best brand to buy in Russia is Lifan. The small SUV Lifan X50, Lifan X50 and X60 are both in the market. Single model sales list.
With the twists and turns of the road, there is good news after all. At present, Lifan has established a direct sales company in Russia with more than 750 employees and 90% of local employees. Among them, the general manager is a Russian, and the deputy general manager is a Chinese, who is dispatched from the headquarters of Lifan. Under the policy guidance of the "One Belt One Road", FAW and other companies began to deploy in Russia, participated in the Russian passenger car show, and the new car Pentium X80 was also successfully launched in Russia.
Great Wall Motors is also a major Chinese car company in Russia. It has established a sales company in Russia and has stable operations. Also in terms of localization strategy, its plant in Russia's Tula region will be the first vehicle manufacturer for a Chinese automobile company in Russia that covers the four major production processes of stamping, welding, painting and final assembly. The project has a total investment of 500 million U.S. dollars, and the annual output will reach 150,000 vehicles after it is put into production.
Saudi Arabia
Saudi Arabia is an important stop in China's "One Belt One Road" blueprint. It is world-famous for its oil and is the "big brother" of the Organization of Petroleum Exporting Countries. In 2016, the trade volume between China and Saudi Arabia reached 42.364 billion U.S. dollars. Since 2004, Saudi Arabia has been my country's largest trading partner in West Asia and North Africa for 13 consecutive years. Since the beginning of 2013, China has become Saudi Arabia's largest trading partner in the world for four consecutive years.
It borders the Persian Gulf in the east and the Red Sea in the west. It has an advantageous geographical location and close economic and trade relations with China. Of course, automobiles have become one of Saudi Arabia's fastest-growing products. According to statistics, the annual car consumption in the Gulf region is about 1.4 million units, and Saudi Arabia accounts for 650,000 units. Its market importance is self-evident, and it has become one of the markets for major auto manufacturers in the world to compete.
But Saudi Arabia also has its particularity that is different from other regions: cars entering Saudi Arabia must obtain car access certification, that is, Gulf certification (GSO certificate). All car products in the world that want to enter this area must pass this certification. GS0 certification is a bit similar to European standards, with high requirements for collisions. The cost of certification for a single model is basically about 1 million to 1.2 million yuan. This creates a lot of difficulty for market entrants.
In addition, another major feature of Saudi Arabia is the hot weather, which is as high as 56 degrees at the hottest time, and the summer lasts for up to 8 months. This requires extremely strict car performance. In addition, the hot weather also caused the landing of the entire team. Not a small challenge.
Consumers' needs, unruly driving habits, high temperature, sand and dust, quality, etc., Saudi Arabia's consumers are picky enough. The level of luxury in Saudi Arabia is well known, but the degree of pickiness of its consumers is obvious to all. This poses a challenge to Chinese car companies.
In 2016, Saudi Arabia's automobile market sales reached 655,500 vehicles, a year-on-year decrease of 21%. Japanese cars are very popular in Saudi Arabia, and Toyota cars account for almost 60% of the market models. In recent years, Chinese cars have also received good sales in Saudi Arabia. Geely is the best-selling domestic model in Saudi Arabia.
Of course, there is no shortage of Chinese car companies that are deeply plowing the Saudi market. Bus brands including Ankai Bus and King Long Bus have a good reputation in Saudi Arabia, and the export market is promising; passenger cars represented by JAC, Geely, and Chery have also received a lot of praise in Saudi Arabia and their sales are bullish. Under the guidance of the goal of continuously optimizing products and making high-end cars, the development of Chinese car companies in Saudi Arabia will also be smoother.
Pakistan
Pakistan, this is the only country that puts friendship with our country into the law. There is one item in the law called "crime of damaging Sino-Pakistani friendship", which shows that Pakistan values China. The "China-Pakistan Economic Corridor" is a flagship project of China and Pakistan, and a major project of the "Belt and Road". At the same time, as an important stop on the Maritime Silk Road, Pakistan plays an important role in the "Belt and Road".
Three-fifths of the entire territory is mountainous and hilly, and the southern coastal area is desert with uneven roads, so off-road vehicles are extremely popular. At the same time, better farming conditions have also brought a lot of markets for agricultural vehicles and mechanical vehicles. As Pakistan's infrastructure investment continues to increase, its domestic demand for economic and durable commercial vehicles is strong.
In 2016, the annual sales of Pakistani cars were 211,300 units. Domestic cars are mainly dominated by Japanese cars, but Chinese car brands have not achieved large-scale introduction. Japanese automakers Suzuki, Toyota, and Honda respectively occupy the top three in the sales charts. And Toyota, Honda, and Suzuki have all built factories in Pakistan before, preparing to stick to this emerging market. Although Chinese car companies have made some moves, they have not made a complete layout. Although Dongfeng's commercial vehicles have been selling well in Pakistan, and Great Wall's models are also very in line with the tastes of Pakistani consumers, these are still small-scale operations and have not shaken the entire market. In Pakistan now, Japanese cars are almost the dominant one, and the prices of their products are relatively high.
Nowadays, Pakistan is a rare development opportunity for Chinese car companies. Pakistan is also constantly looking for other partners and handing out an olive branch to Chinese car companies. However, considering Pakistan's long-term political stability and security situation, car companies will face severe challenges in building factories in Pakistan. Under the conditions of the “Belt and Road”, the overseas road still needs to be advanced, but how to avoid risks and achieve common development is also a problem that Chinese car companies must consider when going global. Chinese car companies need to seize the opportunity to increase their attention to the Pakistani market and occupy a broader market.
Chile
While linking Asia, Europe and Africa, the "Belt and Road" project is also an important measure that affects the world. Today's "One Belt, One Road" has gradually taken on a different outlook from the past, connecting the world economy through infrastructure projects. Global transportation, communications, and information connectivity are not limited to Eurasia, South America should also participate in it.
For Chile, China has become one of its major trading partners, and the development of bilateral transportation, trade and logistics is extremely critical. At this “Belt and Road” summit, Chilean President Bachelet was also invited to participate to discuss the results and future of the “Belt and Road”. The economy of Chile is developed, and the Chileans also have the characteristics of South America: they not only have the unrestrainedness of South Americans, but also retain the meticulous and seriousness of their European ancestors. This also affects the consumption habits of Chileans. They consume more rationally and pragmatically, and at the same time love trends. In Chile, Mercedes-Benz and BMW are rarely seen, and Chinese brands are very popular here.
The Chilean auto market ended with 319,600 vehicles in 2016, a year-on-year increase of 7.3%. The top three in Chile's auto market sales are Hyundai, Kia and Chevrolet. Korean cars with high cost performance are very popular in Chile. In recent years, Chinese cars such as Chery, Jianghuai, and BYD have made many exits on the streets of Chile. Chery is currently the Chinese car brand with the highest market share in the Chilean car sales market. Chery attaches great importance to the Chilean car market. The first car market of Arrizo 5 is in Chile. But looking at the market sales, it is not satisfactory. Years of investment have allowed Chinese brands to take root in Chile, but it will take time for the overall brand reputation and recognition to improve.
Of course, with the increasingly close economic development of China and Chile, as long as they endure hard work, the market for Chinese car companies in Chile is broad enough.
This is only a small part of the 65 countries along the “Belt and Road” and related countries. This open and inclusive "circle of friends" will drive the common progress of countries along the route and achieve broader development.