The fast-growing and high-yielding Hwayang salmon that foreign car manufacturers in China have enjoyed in the Chinese car market for decades is coming to an end.
The shocking news that Volkswagen Group, the world's top car manufacturer, is reviewing Germany's factory closure for the first time in 87 years of history,
is becoming a thorn in the side of serious challenges faced by foreign car companies as a result of China's infinite competition in the Chinese market and the Chinese government's subsidy policy.
The market where German cars are sold the most is the Chinese market, and last year, Volkswagen sold 40% of the total car production,
Benz sold 37%, and BMW sold 33% in China.
However, German cars are not sold as much as they used to be in the Chinese market.
This is because the cheap domestic car share in the Chinese market is rapidly rising.
According to a series of Chinese car market information meetings, the Chinese car market share of foreign car manufacturers in July recorded a sharp decline of 53% to 33% two years ago.
Volkswagen saw the potential of the Chinese market and launched the Chinese market first than any foreign car company with the first company to start joint investment and production with Shanghai Motors in 1984.
In particular, it has continuously transferred excellent German car development and manufacturing technology and other know-how to China through joint ventures for 40 years,
and it has contributed to the development of Chinese car technology, so the decline in share prices is more painful than anyone else.
In Germany, there is a reaction that the joint investment has come back as a boomerang and dug its own grave.
In fact, many Chinese local car manufacturers are going bankrupt due to the fierce and long-term price war between domestic and foreign electric cars in mainland China,
and foreign car companies are also unable to escape the overwhelming competition.
According to Bernstein, a Wall Street investment company, the price of Chinese cars in June fell by more than 6% year-on-year compared to the same period.
However, even in the midst of the slowdown in the Chinese economy, the Chinese authorities are still expanding the scale of electric car production by strongly pushing new-quality production policies in the direction of economic development.
According to a report by Wall Street Journal, a Shanghai consulting company, Automobility and a series of Chinese car market information meetings,
China's current annual car production capacity is about 40 million, but China's domestic sales are only about 2.2 million,
and China's domestic car production capacity is already in an excessive state, especially China's large-scale overseas export of electric cars is continuing.
This is also the reason why the United States and Canada impose 100% tariffs on Chinese electric cars and Europe is also showing a tariff response movement.
China's electric car exports are not purely a market competition like the Chinese authorities' claims, but are backed by the government's political support and subsidies,
so these unfair trade tariffs and dumping strategies are returning to Germany, Europe, the U.S. car industry, and the serious impact of employment.
