In today’s dynamic automotive market, understanding global and
regional demand is crucial. Our recent webinar, ”
Impact of Chinese Imports on Western Markets and Retail
Networks,” provided a comprehensive overview of current
trends, historical data, and future projections in the automotive
industry.
Before the COVID-19 pandemic, global OEM sales were robust,
exceeding 80 million units annually, peaking at nearly 88 million
in 2019. However, the pandemic introduced significant challenges,
notably a semiconductor chip shortage that affected production and
sales. This shortage created a profitable phase for dealers and
OEMs as vehicle allocation became more critical.
As we move through 2024, the landscape is shifting again. While
Q1 saw positive growth in markets like Greater China, India, and
the UK, Q2 experienced a 1.3% decline in automotive demand due to
affordability concerns and rising interest rates. Consumers have
become hesitant to make significant purchases, reflecting broader
economic headwinds.
Regional Insights
In Q2, Greater China remained the automotive powerhouse,
selling approximately 550,000 units globally, followed by North
America and Europe. However, this number was a drop in total volume
compared to Q1 and resulted in a decrease in China’s global sales
share. The shift allowed North America and Europe to increase their
market share, highlighting the volatility in the automotive
landscape.
OEM Performance
Examining global OEM performance from 2019 to 2024 reveals
varying recovery rates. Brands like Hyundai, Kia, and Toyota have
regained strength, while others like Volkswagen and Stellantis have
struggled. Notably, BYD has entered the top 10 OEMs globally for
sales volume, marking a significant milestone in its growth
trajectory.
In the first half of 2024, BYD’s sales reached approximately
900,000 units, showcasing its rapid expansion and market share
gains, particularly in the face of challenges faced by traditional
manufacturers in mainland China.
The Rise of Chinese EVs
The Chinese automotive market has experienced remarkable growth,
particularly in the electric vehicle (EV) segment. From 2010 to
2023, sales from Chinese OEMs overseas surged to over two million
units, with notable successes in markets like Russia, Australia,
Brazil, and Mexico. Brands such as MG, Chery, Geely, Great Wall,
and BYD are leading this charge.
However, while BYD has achieved significant sales volumes, it
remains less geographically diversified compared to its
competitors. This lack of diversification may explain why they are
not the dominant force in every international market.
Market Share Dynamics
Chinese brands have a strong foothold in the NEV (new energy
vehicle) space, which encompasses electric vehicles, range-extender
vehicles, and plug-in hybrids. Their competitive edge in this area
has allowed them to capture a higher market share in various
countries, including Russia and Turkey.
As the automotive industry continues to evolve, traditional OEMs
are responding to the competitive pressure from Chinese
manufacturers. This includes adjustments in pricing strategies and
potential regulatory actions aimed at leveling the playing
field.
Conclusion
The automotive landscape is in a state of flux, influenced by
economic factors, consumer behavior, and competitive dynamics. As
we move forward, understanding these trends will be essential for
stakeholders across the industry. The rise of Chinese brands,
particularly in the EV market, signals a significant shift that
established OEMs must navigate carefully.
Listen to Bjoern’s full analysis on evolving automotive
trends by accessing a replay of our July 24 webinar, “The Impact of
Chinese Imports on Western Markets and Retail Networks”.
Watch the webinar.
This article was published by S&P Global Mobility and not by S&P Global Ratings, which is a separately managed division of S&P Global.
