The Rise of Chinese Automotive: A Threat to the Luxury Car Market Share

According to Bangkok Post, the rising popularity of Chinese-branded SUVs and pickup trucks is shaking up the luxury car market in Mexico. The sales of once-dominant luxury car brands in the country, such as Mercedes-Benz and BMW, have been impacted.

The Bangkok Post commented that in a country hosting many factories of foreign brands such as BMW and Audi, the preference for Chinese automobiles is considered a remarkable feat.

A few years ago, imported Chinese vehicles were not warmly welcomed in Mexico, similar to the situation in many other markets globally.

Data from the Mexican Automobile Distributors Association (AMDA) revealed that the luxury car segment in the North American country experienced an 8.1% decline in sales during the first 11 months of the year.

Audi’s sales dropped by 21.9%, Mercedes-Benz’s sales decreased by 9.8%, and BMW’s sales, including MINI, remained stagnant in the country with the second-largest economy in Latin America.

In contrast, Motornation, the distributor in Mexico for Chinese automakers BAIC, JMC, and Changan, reported an 8.8% sales increase for these brands during the same 11-month period. Jetour’s sales, in particular, soared by 131% compared to the previous year.

Industry experts attribute this shift to Mexican customers’ growing preference for Chinese SUVs and pickups over luxury sedans, mainly due to factors such as equipment, technology, and pricing.

AMDA data shows that Chinese automakers now hold a 9.3% market share in Mexico’s automobile market.

Guillermo Rosales, President of AMDA, shared with AFP that Chinese automakers have brought competition to the pickup segment, offering features typically found in high-end vehicles from luxury brands.

Asian automakers have also benefited from Mexico’s import tax exemption for electric vehicles, which took effect in 2020 and ended on October 1, 2023.

Miguel Reyes, a 71-year-old retired employee in Mexico, said that choosing a Chinese car over other brands was a “simple logic” decision.

“I needed a car with the necessary technologies to make driving safer,” Miguel Reyes stated.

Competitive pricing is another crucial factor. Mr. Reyes shared that he paid 550,000 pesos (approximately 27,000 USD) for his current vehicle, while a similar model from traditional luxury brands would have cost between 40,000 and 50,000 USD.

Data analyst Gerardo Gomez from J.D. Power mentioned that there are currently about 30 Chinese automakers in Mexico, offering a diverse range of options from small cars to luxurious vehicles.

For instance, BYD’s pickup truck is priced at nearly 970,000 pesos (around 47,600 USD), but the company also has a compact model priced at approximately 7,000 USD. Electric vehicle manufacturer Zeekr is introducing its products in Mexico with price tags equivalent to about 40,000 USD.

This shift in market share towards Chinese automobiles occurs amidst US President-elect Donald Trump’s indications that Chinese automakers are building factories in Mexico to export to the US.

Canadian officials have also accused Mexico of becoming a platform for Chinese products to access the North American market, a claim denied by the Mexican government.

Mexican President Claudia Sheinbaum asserted that only 7% of auto parts produced in the country belong to Chinese companies.

Recently, Mr. Trump threatened to impose a 25% import tax on goods from both Mexico and Canada unless the neighboring countries take action to stop the flow of illegal immigrants.

You may also like

The Untapped Electric SUV: BYD Denza N9’s Design Registered in Vietnam Before China Launch

The fact that BYD has filed for industrial design protection is an indication that the Denza N9 could be coming to the Vietnamese market in the future.

Ferrari Rakes in the Big Bucks in 2024 by Selling Nearly 14,000 Supercars to Global Elite

In 2024, Ferrari delivered an impressive performance, selling a total of 13,752 supercars to customers worldwide, reflecting a 1% growth.

The Ultimate Automotive Extravaganza: VMS 2024 Steers Clear of Becoming Just Another Livestream ‘Car Bazaar’

Despite the emergence of numerous Chinese automotive brands, an all-out sale war through livestreaming has yet to transpire at VMS 2024.

The Ultimate Collision: Chery’s Daring Stunt with 3 Exeed Sterra ES Vehicles to Showcase Unparalleled Safety Standards

Chery recently conducted a three-car Sterra ES crash test, an impressive display of the vehicle’s safety capabilities. This bold move showcases the brand’s commitment to safety and transparency, as the public witnessed the strength and resilience of the Sterra ES firsthand.

The Rise of Chinese Cars in Vietnam: Unveiling the Surprising Surge

The number of cars imported from China is nearly three times higher than the same period last year. This significant increase highlights a growing trend and an opportunity to cater to a rising demand.