South America has become China's largest automotive export market

December 18, 2022

It was learned from the China Association of Automobile Manufacturers Information Conference that South America has become China’s largest auto export market. Last year, China exported 286,500 vehicles to the region, an increase of 18.9% year-on-year, accounting for approximately 30% of China’s total auto exports.

Jian Jianhua, deputy secretary-general of the China Association of Automobile Manufacturers, said at the press conference that currently China's auto export market is dominated by developing countries, mainly in South America, the Middle East, Eastern Europe and other countries. In 2013, four of China’s top ten automotive export countries were in South America, including Chile (79,000), Peru (39,500), Colombia (37,500), and Uruguay (31,100).

Shi Jianhua said that Chinese auto companies such as Chery, Geely, Dongfeng, Futian and Jianghuai have entered the small car market in Latin America by exporting and assembling factories on the local market, and have continuously expanded the scale of automobile production and sales. Among them, Chery has implemented a localization strategy to increase brand awareness by establishing factories in Brazil and sponsoring the country's national football team to enter the World Cup in Chile; Lifan has established a production base with an annual output of 50,000 cars in Uruguay.

Brazil in South America is the world’s fourth-largest car market. Last year, it sold 3.767 million cars. At present, several Chinese independent brands have built assembly plants in Brazil. Chery’s new plant in Yakarei, São Paulo, will be put into operation in the near future. Beiqi Foton and Geely are planning to build plants in Brazil, and BYD is also considering spending money to build factories there. Production of electric buses, JAC's new assembly plant in Brazil is scheduled to start production in 2015, when it will produce 100,000 cars each year, with a total investment of 600 million US dollars.

Shi Jianhua pointed out that there is much room for the development of Chinese car companies in South America. The vehicle ownership in South America is much lower than that in Europe and the United States, and the automotive market has great potential for development. It is an important target market for Chinese auto exports, and Chinese automobiles are inexpensive and popular in the country. However, Chinese autos face fierce competition from GM, Ford, Toyota and other international giants in the South American market, and it is more difficult to open up the market. At the same time, due to the current economic weakness of South American countries, Chinese car companies have also encountered problems such as exchange rate losses and financing difficulties, which have directly affected car sales.

He also pointed out that from the perspective of Chinese auto companies, overseas expansion capabilities have yet to be fully improved. In particular, export products are still different from multinational companies in terms of market orientation, product adaptability, and new product R&D, such as Chilean mountainous terrain. The product improvement response is slower. Shi Jianhua believes that only Chinese auto companies can improve their manpower, capital, and comprehensive capabilities to better support the rapid growth of exports.

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Mr. Liu Keda

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