BMW Benefits from Streamlined Customs, Mercedes Faces Challenges Adjusting Baking Sizes
In the ever-evolving landscape of the automotive industry, German manufacturers are finding the Chinese market increasingly challenging. BMW, Mercedes-Benz, Porsche, and Volkswagen, traditionally dominant players, are facing stiff competition from innovative start-ups like BYD, Nio, Xpeng, Xiaomi, and others.
According to the latest figures, approximately 24 million cars will be sold in China this year, a significant market that German manufacturers can't afford to ignore. However, the decline in sales for these German brands has been a recurring trend in recent years. Volkswagen, despite a drop in market share from 19% in 2019 to 14.5% in 2023, remains the leading German brand in China. BMW and Mercedes-Benz, on the other hand, have seen their combined market share fall from 24% in 2019 to about 15% in 2024.
BMW and Mercedes-Benz rank lower in Chinese market share, with BMW in 9th place and Mercedes in 10th, both showing declines in year-on-year sales. Porsche, while not highlighted among the top German brands in China, trails behind Volkswagen, BMW, and Mercedes-Benz in terms of market share.
The VW group and other German automakers have had to make concessions due to US trade policies in the first half of the year. In response, BMW has announced its focus on the New Class to compete with Chinese start-ups, with range extenders set to arrive in 2026 for various manufacturers. Mercedes-Benz, meanwhile, is introducing the CLA in China, and Volkswagen will bring new models like the ID.AURA and ID.ERO to China, along with Xpeng and Horizon Robotics.
The significance of the Chinese market for German manufacturers is undeniable. Automotive expert Ferdinand Dudenhoeffer from the Center Automotive Research emphasises the importance of stopping the decline in China for German manufacturers. The market environment remains challenging, but the race to maintain and regain market share in China continues.
Elsewhere, the European Union (EU) is expected to see less than 11 million cars sold this year, a stark contrast to the Chinese market. Approximately 16 million cars will be sold in the US this year, another significant market that German automakers are keen to tap into.
In an effort to regain lost ground, it appears that German automakers are ready to adapt and innovate to meet the demands of the Chinese market. The future of the industry in China is uncertain, but one thing is clear: the German manufacturers are not about to give up their fight for market dominance.
- German manufacturers, such as BMW and Mercedes-Benz, are adopting new strategies for investing in technology to compete with Chinese start-ups in the automotive industry.
- With the Chinese market offering significant sales potential, German companies like Volkswagen, BMW, and Mercedes-Benz are introducing new models to cater to local consumer preferences.
- Given the increasing competition from Chinese start-ups and the importance of the Chinese market, the future of German business in the automotive finance sector hinges on their ability to innovate and adjust their strategies.
