European debt hits auto market China will enter deep competition

The traditional car market Europe's car sales data this year is staggering. The European debt crisis continues to fluctuate, and the auto industry bears the brunt. The auto industry has shifted its sales focus to China and restructured in order to strengthen its competitiveness. As the world's largest auto market, what kind of chain effect will Chinese auto industry, especially its own brand, suffer?

European car firms fate differentiation <br> <br> sales decline, stock prices fell, credit rating downgrades, layoffs, closed factories ...... great people of the debt crisis devastating surprise. According to calculations, European car sales fell to the level of 1994.

In this crisis, the fate of different manufacturers has divided. Peugeot, Citroën, Fiat, and Opel, which specialize in the European market, have experienced difficulties due to declining sales, while BMW, Mercedes-Benz, Volkswagen and other high-end manufacturers that have been globally deployed early on have had a much better situation. The effect of this is that all European car manufacturers will follow suit.

It can be expected that in the future, European auto companies will certainly increase their sales in emerging markets represented by China. A series of facts also proved this trend: On June 28th, the GAC Fiat plant was completed in Changsha, the domestic model Feixiang went offline, the Volkswagen signed an investment agreement in Tianjin on August 30, and the foundation of the Beijing Benz second phase project on September 25th. ... And BMW Motors has directly transferred tens of thousands of vehicles originally destined for the European market to the United States and Asia. The focus of its business has shifted to China and the United States. Volkswagen executives also said in the near future: "In the emerging markets to launch a new car prices lower than U p!". Such a series of investments and strategic adjustments have clearly sent a signal that European car manufacturers are overweight the Chinese market.

Greater pressure <br> <br> own brand car prices in Europe will shift Chinese market, will intensify competition in the Chinese auto market. The situation forced them to increase their investment in product introduction, market promotion and even R&D, manufacturing, etc., which may rapidly increase the level of domestic auto market competition.

This is obviously unfavorable for Chinese local car companies. The data shows that the market share of self-owned brands in the first eight months of the year was in a severe downward trend. Only in September was the export business and individual vehicle sales growth improved slightly. The influx of future European car companies will inevitably lead to an increase in the survival of the fittest in the market, and the pressure for survival of domestic car companies that do not have an advantage in many aspects will also increase.

On the other hand, the downturn in the European market has also dampened the confidence of independent brands entering the European and American markets. The relevant person in charge of China's import and export trading company pointed out that the impact of the European debt crisis on China’s auto exports has mainly two aspects. First, the sharp depreciation of the euro has reduced the price advantage of independent brands; second, the decline in consumer spending in the euro area, the market still Shrinking.

For a long time, whether it can enter the mature car market in Europe and the United States is regarded as a landmark event in which Chinese auto companies can truly participate in global competition. With the decline of the European automobile market, it may take longer for independent brands to achieve this goal.

Car prices allied to become the face of the trend <br> <br> unprecedentedly severe crisis, the European car firms are increasingly inclined joint to hold together for warmth. On October 23, the French Council for Economic, Social and Environmental Affairs (CESE) proposed that the European Union establish a true industrial community strategy for coordination. This proposal was obtained by the Chairman of the European Automobile Manufacturers Association (A CEA) and the President of Fiat. Jonathan and Peugeot Citroen Group Philippe Warin support.

In addition to European alliances and sufficient mergers and acquisitions, some European car companies are also actively looking for cooperation with car companies outside the region. On October 24, PSA Peugeot Citroen and General Motors announced that they will deepen their global strategic cooperation and work together Four new car projects, and build a joint procurement organization. Others include the alliance between Fiat and Mazda, and the cooperation between BMW and Toyota.

The impact of the alliance and merger and reorganization between European car companies on the Chinese auto market will remain to be seen. However, it can be determined that they will have stronger R&D capabilities, financial strength, and more cost-effective capabilities after the alliance, which will bring greater competition pressure to other automakers in the world, including domestic independent brands.