Shanghai January 12 (Gasgoo.com) To the foreign manufacturers currently dominating 60-70% of the Chinese automobile market, China is still the largest and most tempting piece of the proverbial global auto market pie. Other then is annual sales volume surpassing 1.7 million vehicles and sales volumes constantly setting new records, China is an attractive market because car sales can reach highs simply not possible elsewhere. According to Gasgoo.com’s latest survey, experts believe that Volkswagen’s extraordinary success in the Chinese market is not a unique case, but rather typical for foreign brands selling in China. Furthermore, they believe that this phenomenon will continue to last for quite some time.
A few days ago, Germany's University of Duisburg-Essen issued a research report regarding Volkswagen's market performance. The Wolfsburg-based manufacturer’s average global profit per vehicle is approximately 683 euros ($884) with a profit margin of 4.9%, placing behind other German manufacturers. However, its average profit in the Chinese market reaches 1,000 euros ($1,294) per vehicle with a profit margin of 7.2%, a figure 46.4% higher than its global average. Additionally, its total sales of 1.48 million vehicles are over double the amount sold in its home country.
According to our latest survey of 2,718 industry experts and analysts, taking place from November 23 to 29, VW's average profit per vehicle of 1,000 euros per vehicle can only be considered average in China. In response to the question 'Is VW's exceptional performance in the Chinese market a unique case or typical example of foreign brands selling in China?', over 90% answered 'typical example.' When asked why foreign brands are so successful in China, results were mixed. One-third of participants answered that the Chinese market is 'less competitive than other markets,' while 22% believed that foreign products are 'relatively higher positioned.' Still 19% believed the key reason was the automobile market’s fast growth and 14% said it was because of an unequal supply-to-demand relationship
The Chinese automobile market offers a unique possibility for foreign manufacturers that they cannot find anywhere else. When asked how long the high sales the market offers foreign brands will last, 64% of respondents answered more than five years, with only a minority believing that sales would die out before then.
