A GAC Aion Hyper SSR electric sports car is displayed during Auto Guangzhou 2023 at the China Import and Export Fair Pazhou Complex in Guangzhou, China's Guangdong province, Nov. 17, 2023.
vcg | China Visual Group | fake images
Chinese automakers are expected to continue expanding rapidly outside their home country to reach 33% of the global automotive market share by 2030, according to a new report released Thursday by prominent consulting firm AlixPartners.
Much of the growth, from a projected 21% market share this year, is expected to come outside of China. Sales outside China are expected to grow from 3 million this year to 9 million in 2030, representing 3% to 13% growth in market share by the end of this decade.
The rapid expansion of Chinese automakers is a growing concern for traditional automakers and politicians around the world. Many fear that less expensive vehicles made in China will flood the markets, undercutting domestically produced models, especially all-electric vehicles.
AlixPartners said it expects Chinese brands to grow in all markets around the world. However, the company added that it expects much smaller expansion in Japan and North America, including the United States, where vehicle safety standards are stricter and a 100% tariff has been announced on imported Chinese electric vehicles.
“China is the new industry disruptor, capable of creating must-have vehicles that are faster to market, cheaper to buy, advanced in technology and design, and more efficient to build,” Mark Wakefield, global co-leader of the automotive industry and industrial. practice at AlixPartners, said in a statement.
In North America, Chinese automakers are forecast to only reach a 3% market share, mainly in Mexico, where one in five vehicles is expected to be Chinese-branded by 2030. In most other regions major companies in the world, AlixPartners reports that the share of Chinese automakers is expected to grow exponentially. Those areas include Central and South America, Southeast Asia, and the Middle East and Africa.
Chinese brands in China are also expected to grow from 59% to 72% in market share, according to AlixPartners. Traditional car manufacturers such as General Motors have lost significant ground in China in recent years amid the rapid rise of China's domestic auto industry and companies like BYDGeely and child.
Models unveiling the Chinese automaker's electric car, the BYD Song MAX, at the 45th Bangkok International Motor Show 2024 in Nonthaburi province, outside Bangkok, Thailand, on March 30, 2024.
Nurphoto | Nurphoto | Getty Images
In Europe, where Chinese automakers have grown rapidly in recent years, the market share of Chinese auto brands is expected to double from 6% to 12% by 2030, according to AlixPartners.
Chinese automakers are expanding because they have cost advantages, localized production strategies that will enable a build-where-you-sell strategy in markets outside China, and highly technological vehicles that meet changing consumer preferences for design and coolness, the report said.
“Automakers hoping to continue operating under business as usual principles will be in for more than just a rude awakening: They are headed for obsolescence,” Andrew Bergbaum, global co-leader of AlixPartners' automotive and industrial practice, said in a statement. .
Chinese EV automakers create new products in half the time of traditional automakers (40 months vs. 20 months) primarily by designing and testing to sufficiently meet standards rather than over-engineering. They also have a 35% “Made in China” cost advantage.
Wakefield said that for traditional automakers to compete with the Chinese, they need to rethink their business development processes and the pace of vehicle development.
