Chinese car brands are all over the market right now, but many may not be around for the long term. But most of those will not be around for the long term, based on one source.
The Warning, Straight From the Source
When asked how new Chinese brands could convince people that they would still exist in a few years, Danilo Annese, commercial head for Enlarged Europe at Leapmotor International, simply replied: “Bluntly, it’s difficult to believe that.” He claimed that not many would survive for long but did not specify the brands and quantities.
Why Many Chinese Car Brands May Not Survive
The concern is supported by history. Australia has already experienced a previous influx of Chinese brands that came and vanished.
The picture is even starker on a global level. There were more than 40 “new force” brands for EVs competing in China at one time. In a span of 3 years, over 30 of them had already fallen. Some 15 of the 129 brands available in China will likely survive by 2030, at which point they will command about 75% of that market, according to consultancy AlixPartners.
What Will Help Chinese Car Brands Survive?
Annese claims that the three things that rule survival are: Showing that you can support the car after-sales service, you can serve current customers, and you can create a real business.
With backing from Stellantis, Leapmotor is doing its best to prove that point. Leadership has referenced “parts availability” and “retail commitment” that go with it, which they say is something many competitors do not have a solid foundation.
Chinese EV Brands Face Similar Pressure Worldwide
Very similar worries about Europe came up from a senior Skoda executive. There are currently about 150 active EV and Chinese car brands competing in China, and consolidation is expected. Vendors are broadly saying only the good, well-funded, well-supported brands, like MG and BYD, are in a position to survive.
Why This Matters for Buyers?
Then, for consumers all across the world, including markets such as Pakistan, where consumer products from new Chinese companies have become popular in recent years. A purchase of a car is a long-term one. When a brand retreats, parts and service availability, along with resale value, can suffer.
Conclusion
The warning from an industry site that most new brands from China will fail is not fanning the flames, but rather a warning call. So when determining which new entry to spend your money on, for consumers, the brand “longevity” and “after-sales” service are just as important as the spec sheet.
