Arrow: China's commercial vehicle production accounts for nearly half of the global

Global Business Consulting Company Arrow Launches “2010 Global Commercial Vehicle Industry Outlook Report”

The position of commercial vehicles in China is obviously much higher than that of passenger vehicles. Global commercial vehicle industry outlook report released recently by global business consulting company AlixPartners (Ai Ruibo) shows that in 2009, global commercial vehicle production decreased by 29%, while China’s commercial vehicle market experienced an inverse market growth of over 22%, and It accounts for 49% of total global output in terms of production unit. In the first half of 2010, China’s commercial vehicle market further increased by 76%. The driving force for this strong growth comes from China’s advantage in producing low-cost products to meet such as Africa and Southeast Asia. Demand for booming emerging markets, and demand from the Chinese market itself. Even considering the lower average value of commercial vehicles in China, this growth still shows that China has a huge share of global commercial vehicle production. For those mature commercial vehicle manufacturers from Western Europe, the United States, and Japan, this is a A serious challenge.

The top 15 Chinese companies in the world account for 1/3

The report pointed out that some western commercial vehicle manufacturers have underestimated the growth potential of China and other emerging markets, and they are not designing their products value-oriented to meet the needs of the local market. As a result, the profitability of China's major commercial vehicle manufacturers is gradually increasing. This has led to an increase in research and development capabilities and an increase in global market share. Among them, five Chinese OEM manufacturers are already ranked among the top 15 suppliers of commercial vehicles in terms of output. Among them, they are: Dongfeng, China FAW, China National Heavy Duty Truck, Foton Motors and Shaanxi Automobile, accounting for 1/3. Strong demand from China and other emerging markets will continue to grow rapidly, and it is expected that the global commercial vehicle production will increase by 1.8 million by 2014, of which more than 50% will come from these markets.

According to the Arrow report, due to the increase in automobile emission standards in China and other emerging markets, the entire industry is beginning to evolve toward manufacturing of mid-range vehicles. This is both an opportunity and a challenge for both Chinese and mature Western manufacturers.

Luo Man, managing director and head of the Shanghai office of Arrow, said: “Localization of products in specific markets is critical to achieving market share in the global environment.” He also pointed out: “Through the maintenance of acceptable costs While improving product quality at the same time, China has successfully entered the mid-range market for commercial trucks, and the fast-growing economy in emerging markets including China itself has a strong demand for the mid-range commercial vehicle market. This growth will continue, and Chinese commercial vehicle manufacturers have the ability to increase their investments in R&D to upgrade their production technologies so that their products can meet certain emission standards in China and in emerging markets in the world. However, they are not enough to seize the commercial vehicle market.' Technology' part to meet the needs of those countries that have the highest requirements for technology and emission standards."

Commercial Vehicle Market to High-end Product Development

Many governments around the world are pressing ahead with a timetable for raising emission standards. China is currently implementing the Euro III emission standard and will formally implement Euro IV this year and implement Euro V emission standards in 2012.

In addition to this, a number of other factors, such as the implementation of safety standards, the increase in energy prices, the improvement of infrastructure and the demand for high load capacity, are prompting China's commercial vehicle market to develop into high-end products.

These challenges have led some Western companies to form alliances with China’s leading companies and have occupied a minority stake in Chinese-funded companies. For example, China National Heavy Duty Truck Group recently conducted strategic cooperation with MAN from Germany. However, for those foreign companies wishing to enter the Chinese market, there are already a few potential partners in this industry.

"The commercial vehicle market will also experience a period of sustained growth before 2014, and the European and U.S. markets with huge volumes of output will recover," Roman said. "We expect the year-on-year growth of China's commercial vehicle market will moderate since then, because the The growth base of the market is already large, but local manufacturers will continue to occupy more than 95% of the market share, which is different from foreign manufacturers' share of most of the market in the passenger car market. The biggest question, then, is who will win the largest share of growth in emerging markets."