Islamabad, 19 August 2024 (TDI): In terms of price, features, comfort, and durability, the Chinese automobile industry has been outperforming major foreign brands
As Chinese enterprises replace the European and Japanese multinationals that established factories in China forty years ago, the former are currently shutting down operations.
Technology from the US, the EU, and Japan used to be the gold standard, and their cars outsold those from Chinese manufacturers. But in the two decades since it stopped producing copies, China has completely changed.
Chinese manufacturers are now selling premium cars for less money. Because they have a sizable home market, they test frequently there, which helps them succeed abroad.
China had to import engines at first since it was lagging behind in engine technology. China, on the other hand, has produced its own engines and has advanced significantly in research and development (R&D) during the past 15 years. China has surpassed Europe and Japan, who were formerly at the forefront of engine technology. China’s electric vehicle (EV) sector is starting to grow faster than that of its competitors.
Muhammad Sabir Shaikh, an auto industry specialist, dealer, and industrialist, pointed out that the Chinese automobile industry used to make low-quality cars 20 years ago. But in terms of both price and quality, it has outperformed nearly every market leader throughout the past 15 years. China has had the chance to develop and enhance its products thanks to the size of its local market.
Chinese automakers are shifting their attention from hybrid cars to electric ones. According to Shaikh, only Japan is still promoting hybrid vehicles, but that country will probably lose in the upcoming years.
Positive reviews of Chinese brands including Haval, Changan, and FAW have come from consumers in Pakistan. China has approximately ten years of experience selling gasoline-powered automobiles to foreign markets, whereas electric vehicles have been exported for four to five years.
Resale value is a crucial factor in nations like Pakistan where cars are frequently viewed as movable possessions. Although the resale value of Chinese products is still growing, as their quality keeps rising, it should get better.
Also read: US-China Cooperation Crucial For Global Economic Stability
The US and Europe continue to lead the EV market, while Japan leads the hybrid market, according to auto industry researcher Mashood Khan. But China is currently outpacing Western markets in research and development, having narrowed the difference between fuel-powered and electric vehicles. Today, the US/EU, China, and Japan are the three major participants in the global car industry.
Pakistan manufactures 200,000 cars every year, while China’s enormous domestic market generates 27 million. Local brands comprise almost half of China’s total automobile production. With its domestic production still expanding, China is becoming the market leader and posing a serious threat to Western nations.
China has acquired a substantial market share and developed a solid position in the international market despite entering it later than expected.
China invited world leaders to establish plants there, including Volkswagen AG, Toyota Motor Corporation, Honda Motor Company Limited, Mitsubishi Motors Corporation, Mazda Motor Corporation, Volvo Cars, General Motors (GMC), and Chevrolet, according to eminent researcher and economic analyst Zamir Ahmed Awan.
In the 1980s, Volkswagen opened its first factory in Shanghai. When Awan visited the plant, he was in China and remembered that it made attractive models at affordable costs.
In light of China’s close friendship and willingness to share its knowledge, he emphasized that Pakistan has a wonderful potential to gain from China’s technology. Though they want guarantees that both their money and lives would be safe, Chinese businessmen are keen to make investments in Pakistan.
Although there is a lot of promise for EVs in Pakistan, a developing nation, many people there cannot afford fuel-powered cars. Chinese investors will not hesitate to make investments in Pakistan provided the government formulates a viable, long-term policy and guarantees that policy changes won’t occur after investments are made.
In Pakistan, the cost of fuel-powered cars might be cut in half by purchasing Chinese electric vehicles. Developing a strong automotive strategy with the involvement of all stakeholders has the potential to revolutionize the local vehicle industry; however, the sector needs a long-term, sustainable policy in order to be revived. Foreign investors will not make investments if there is a lack of policy continuity, which they trust. History and prospects for the future:
Forty years ago, Russian technology served as the foundation for the Chinese automobile industry. Although they lacked contemporary amenities and were not fuel-efficient, these cars were nonetheless sturdy. China adopted a long-term strategy to entice global market leaders in the automotive industry with beneficial incentives after it started its journey of modernization and reforms.
Due to this policy’s affordable labor, tax breaks, enhanced law and order, and lenient regulations, foreign investors were drawn to China to open auto factories. As China’s labor force became more trained, it started to produce cars under its own local brands, but at first, market leaders made the cars under their own regulations and quality supervision.
Due to their affordability, high quality, and use of cutting-edge technology, these regional companies have become more well-known over the past 20 years. Modern automobiles, buses, trucks, and motorbikes with cutting-edge designs and cutting-edge R&D are currently exported by China’s self-sufficient auto sector.
Becoming the market leader for EVs was China’s next move. As the biggest producer of EVs worldwide, China leads the industry without any rivals. China has outperformed other global leaders in the automotive sector in terms of both quality and production cost.
Also read: Local Automakers Seek New Possibilities For Export
In order to stop the rapid expansion of Chinese EVs and safeguard their faltering domestic sectors, the US and Europe have enacted stringent restrictions, including new taxes and levies. Through these actions, the US and EU markets hope to drive down the price of Chinese electric vehicles.
Despite these obstacles, the alluring features and affordable prices of Chinese EV firms, such as BYD, have had a substantial impact on the sales of the US and European EV sectors.
With its affordable electric cars and motorbikes continuing to gain popularity worldwide, China is predicted to be a major industry leader in the upcoming years.
