Dongfeng Nissan Shall Introduce 50 Thousand Product, Compete in Low-end Segment

One month ago, a senior manager of Dongfeng Nissan says during interview that the company plans to introduce a small size car, which will be priced about 50 thousand CNY automobile entry level segment. The message has aroused a lot of eyesight. Some other companies include Volkswagen and Ford introduce low-end product in China before.

Since new urbanization strategy pop out, Chinese towns change has speeded up. “It brings a huge power for our auto industry. Third even fourth tire cities auto sales will fast increase.” CUI Dongshu, vice generalsecretary of China Passenger Car Market Information tells media during interview.

According to statistics, sales of third and fourth tier cities of 2012 takes 30% of total auto sales, and the figure for 2011 is 26.7%. More than 800 million populations of third and fourth tier cities now become auto consumers.

REN Yong, vice general manager of Dongfeng Nissan tells reporter that “with the speeding up of urbanization, more and more citizens become auto consumers, and entry level auto segment will enlarge.”

Besides Dongfeng Nissan, Volkswagen says it will cooperate with FAW to introduce a 50 thousand CNY product into Chinese market in low-end segment. HAN Ruilin, president of Ford Asia Pacific says as well “providing products to third even fourth tier cities is very important for Ford. We are able to introduce product with price even lower than Carnival.”Meanwhile, SAIC Sail has already covered segment under 50 thousand CNY.

Insider points out that with joint venture product price going deeper, China owned brand will have its new challenge. At present, 70 thousand CNY is the divided line. China owned brand takes price fewer than 70 thousands segment. However, with 50 thousand divide line, China owned brands start separated.

According to statistics from China Passenger Car Association, familiar using auto has upgrade with the middle and small town’sfamily’s income growth. The original 20 to 30 thousand CNY products demand new upgrade to 50 to 70 thousands.

CPCA shows that FAW Chaalis, Chery QQ, Geely CK and Changan Benben, which prices are all under 50 thousand CNY, market share all decline. Chaalis and Geely CK sales even have declined more than 30%.