The Chinese car market is fluctuating in the first four months of 2017: After a stable January, a promising 20% gain in February 2017 and a modest growth of 2,9% in March, April sales are down 2,2% again, for a total of 1,68 million units. Of course, this is still the second-best ever April figure, and the YTD total now stands at 7,54 million, an increase of 3,8% on the first four months of 2016. The Seasonally Adjusted Annualized selling Rate stands at 21,4 million in April, the lowest figure in the past 12 months. Sales of vehicles with engines of 1,6 liters or less fell 10% to 1.14 million, after the central government phased out a tax break on these models at the beginning of this year. SUVs and crossovers are once again the main (and only) winners in April with sales up 10% to 674.000 units, while sedans sales decline for the second consecutive month at -7,3% to 840.000 sales and MPVs lose volume for the fourth month in a row at -15% to 153.000. New Engergy vehicle sales improved 7,9% to 34.300 units, as EV sales gained 19% to 28.500 units but PHEVs plunged 27% to 5.800 sales. The share of domestic automakers dipped below 42% for the first time since last August as they benefitted the most from the tax cut on small vehicles.
The Haval H6 takes the lead of the ranking again for only the third time ever, after April and November 2016, with a lead of just 224 units over the Wuling Hongguang. Last month’s #2 Volkswagen Lavida is down to 5th, as it’s outsold by the Buick Excelle GT and the Nissan Sylphy. The second best selling crossover is once again the GAC Trumpchi GS4 in 6th place, followed by the all-new Baojun 510 in 9th place and best seller of the brand in only its third month of sales. We have a record 10 crossovers in the top-25 this month, with the Geely Boyue knocking on the door of the top-10, record sales for the Honda XR-V in 13th place and the Haval H2 continuing its strong form in the top-20. Like last month, Volkswagen is in trouble with some of its best selling sedans, as the Lavida, Jetta, Sagitar and Santana all show double digit losses, making the Tiguan the brand’s #3 thanks to the long wheelbase Tiguan L. The MG ZS is already the brand’s best seller in only its second month of sales, in 48th place with almost 10.000 sales. The Jeep Cherokee appears unharmed by the launch of the smaller Jeep Compass and is stable in 55th place while the Compass rises to 73rd place.
Last month we reported Audi had reached an agreement with its dealers that it would ditch its plans to build a competing dealer network with cars from the SAIC-Volkswagen Joint Venture until it reaches 900.000 annual sales. Well, this month we can say Audi reconsidered that agreement and as a result the standoff with its current dealers will continue and the brand’s sales will suffer for at least a few more months. In April, Audi sales in China were down 10,5% to 42.451 locally produced units (46.166 including imports), while BMW improved 48,6% to 34.837 sales of locally produced models (48.869 including imports and Mini), and Mercedes-Benz grew 54,3% to 34.613 sales of locally produced cars (47.627 including imports). As you can see, Audi’s sales of imports are hit the most, that’s because most of the protesting dealers are (partially) state-owned and so is FAW, the producer of its local models. So on one hand they want to pressure Audi by reducing orders but on the other hand they don’t want to hurt Audi’s current JV partner too much, because it’s heavily dependent on profits from the production of Audis as its own domestic brands are persistent money-losers. Volvo grew 17,7% to 5.088 sales of locally produced models (+38% to 8.687 including imports, most notably the XC90 SUV), while Jaguar enjoyed record volume of its sole locally produced model XFL at 1.660 units, staying just ahead of its rival Volvo S90L with 1.602 sales. Sister brand Land Rover enjoyed stable demand for its two locally produced models.
Volkswagen is down faster than the overall market at -5,1% as sales of its sedans slump, with the notable exception of its midsized offerings Passat and Magotan. The Tiguan benefits from the addition of the “L”, and the Teramont is gaining traction with almost 5.400 sales. Sister brand Skoda is down for the second consecutive month and is now also in the red year-to-date, but the introduction of the Kodiaq SUV should give the brand a boost in coming months. Renault sales of its two locally produced models seem to have stabilized around 6.000 monthly units, which means it’s closing in on rival French brand Citroën which is down 63% to just 7.747 sales, its second worst monthly volume ever, after last February. Only the C-Elysee managed to sell more than 1.000 units in April. Sister brand Peugeot isn’t doing much better at -49% to 14.478 sales, also its second worst monthly volume ever, after last February. The new 5008 SUV was launched last month, which should boost the brand but so far the 4008 (known as the new 3008 SUV in Europe) isn’t living up to those expecations either. And I may have said this before, but luxury brand DS has now officially and utterly failed, with its lowest monthly volume ever at a mere 228 sales. The DS6 crossover is the only of its four models to sell over 100 units. The brand will soon launch the DS7 Crossback but much more is needed than a single model launch to revive the struggling brand.
Buick has fluctuated between small losses and small gains this year and April is not different: a 4,4% gain to 91.823 sales, while sister brand Cadillac continues its explosive growth in China, again almost doubling up on last year to just over 14.000 sales. Its rival Lincoln only imports its models but also almost doubled up in April to 4.500 sales of imported cars. Chevrolet has scored its first double digit gain since 2014, helped by the launch of local production of the Equinox crossover, which immediately racked up almost 5.700 sales in its first month and could easily become the brand’s best seller in China. Rival Ford continues to struggle with a fourth consecutive month of losses, of which three with double digits. A 20% decline to just 49.000 sales of locally produced Fords means it scores its lowest monthly volume since February 2013. The biggest culprit is the Escort, which is outsold by the more expensive Focus for the first time in 19 months, probably because of increased competition in the low-cost sedan market by the Chevrolet Cavalier, Geely Emgrand GL and now the Hyundai Celesta. But Ford also struggles with its crossovers as the EcoSport and Kuga both lose more than 70% of their volume on last year. After scoring record volume of 20.661 sales in March, Jeep is stable with just 15 fewer sales in April, which means the brand has now more than doubled up for three straight months, thanks to the expansion of its line-up to three models.
When is Honda‘s winning streak in China going to end? Nobody knows, but the fact remains that China is quickly shaping up to become the Japanese brand’s biggest market, as it shows an increase of 24,7% to 120.233 sales in China compared to a loss of 6,3% to 124.254 sales in the US. Nissan also keeps outgrowing the market, with an increase of 10% to 80.782 sales while Toyota shows a loss of 2,1% to 86.558 sales despite the launch of 2 new nameplates this month. Mazda remains one of the fastest growing brands in China thanks to the launch of the CX-4 last year, as it adds 47,6% to its volume, for a total of just over 23.000 sales. As the CX-4 is nearing its first anniversary, the brand is planning to launch the smaller CX-3 in China to keep its winning streak alive. Mitsubishi tops Mazda’s growth rate by a large margin, as it triples up to 10.140 sales thanks to the start of local production of the Outlander. After a nice rebound in March, Suzuki is back into deep red figures with a loss of 37,7% to just 6.603 sales.
Hyundai and Kia have been struggling in China recently due to a heavy reliance on sedans and a poor brand image and were feeling the pressure of improving quality, continued low prices and a quick pace of new model launches (especially affordable crossovers) by domestic automakers. For the last two months that decline has accelerated due to negative sentiment against South Korean companies, from automakers to retail businesses, because of a nationalist backlash over Seoul’s decision to deploy a US missile defense system that China says is equipped with a radar powerful enough to penetrate Chinese territory. On top of that, Kia is also in a dispute with some of its dealers, which results in a second month of 68% decline to just 16.000 sales as the brand’s crossovers are hit especially hard. Sister brand Hyundai doesn’t fare much better wiht a 63,6% decline to 35.000 sales, with also the biggest hits to its crossovers.
Shock and horror at Changan, after 14 months of non-stop growth and only 2 small losses in the past 59 months, as a result of which sales more than quadrupled from 2012 to 2015 and more than doubled from 2013 to 2016, the brand has been one of the ongoing success stories among domestic brands, as it was the first Chinese brand to top 1 million annual sales and therefore the first to challenge the foreign brands in terms of volume. A steady expansion of its line-up with crossovers has been the greatest contributor to this success. But in April Changan suffers a sudden drop of 50% year-on-year to just 44.646 sales, compared to 123.102 in March, and as a result the brand drops into the red year-to-date as well. We’ll have to wait and see next month if this is just a flaw in the data or really bad news for Changan, but it’s not a good sign the losses are spread across almost all of the brand’s models. As a result, for only the second time in the last 2 years, Geely is the best selling domestic brand in China (and #4 overall, it’s highest ranking ever), while Changan is down to #5 domestic brand/#11 overall. Great Wall’s Haval SUV brand is struggling too with its first year-on-year loss since April 2013, as only the H2 and H7 improved. Baojun also scores its highest ranking in 8th place thanks to the ongoing success of the 310 small hatchback and the runaway hit of the 510 crossover.
GAC Trumpchi extends its double (or even triple) winning streak to an impressive 61 months with sales up 48,4% to 41.705 thanks to the second consecutive month of 10.000+ sales of the GS8 large SUV and continued strong volume of the compact GS4 crossover. Chery has been in growth mode since the introduction of its best seller Arrizo 5 sedan last year, but its crossovers including the flagship Tiggo 7 also contribute to its 27% growth to 36.694 sales. BYD has struggled this year after the Beijing government slashed EV subsidies and the company failed to compensate buyers with discounts. The biggest selling EV brand has now been overtaken by BAIC, which did slash prices of its EVs in response to the subsity cuts, and which more than doubled its EV sales so far this year. BYD sales in April were down 14,2% to 30.382 units. The two domestic brands of Shanghai Automotive, SAIC Roewe and SAIC MG have been on a roll lately thanks to successful new products, and they continue to do so. As mentioned above, the MG ZS is already the brand’s best seller in its second month of sales, with 70% of total MG sales, helping the brand double its volume to 13.854 sales. Roewe improves an even more impressive 155% to 27.753 units thanks to the RX5 crossover and the new i6 sedan.
Among smaller brands, after four years of double digit growth including a 54% gain in 2016, Zotye appears to have hit a road block as April marks the third month this year the brand loses more than a third of its volume. Zotye had been successful with its copycat design, and the infamous SR9 crossover which is an obvious clone of the Porsche Macan at less than a fifth of the price of the original was the brand’s best seller in April, but sales of its other crossovers T600, Damain X5 and the Audi Q3 clone SR7 have suffered greatly. Similarly, Landwind, the producer of the Landwind X7 which is an obvious clone of the Range Rover Evoque, is suffering from a similar downfall, with four consecutive months of huge losses, and an 80% loss to just 1.500 sales in April. The brand doesn’t report sales by model, but the X7 is clearly the brand’s biggest seller by far. Perhaps the Landwind X7 is feeling the competition from the Zotye SR9 in the subsegment of cheap clones of European luxury SUVs. Also worth notable is the almost 20-fold increase of JMC (Jiangling Motor Corp.), up from a low of 208 sales a year ago to 4.138 sales in April as it replaced the Yusheng crossover by a new generation called Yusheng S350 and added a smaller version Yusheng S330 in the past 12 months.
Now that Renault has celebrated its first anniversary, the best selling new brand (Hanteng with 5.012 sales, followed by SWM Motor with 4.776 sales and Borgward with 4.598 sales, as the new BX5 appears to cannibalize sales of the larger BX7.
China brands ranking April 2017
Please note these figures are for locally produced models only, they exclude imported cars, which make up only a small portion of sales in China.
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