Beijing Auto Show: Weekend Highlights

Mostly Positive Reviews From Chinese And Western Press And Blogs

Visitors look at the new extended Mercedes E Class (Photo: AP)

Visitors look at the new extended Mercedes E Class (Photo: AP)

Last week, in preparation for Auto China 2010 — the Beijing Auto Show — Jing Daily looked at Bentley’s new China-only Continental models and discussed Chery’s announcement that the company had signed soccer star Lionel Messi to promote its upmarket Riich brand. Over the weekend, as the show opened to the public, a number of other stories have come out in the Chinese- and English-language media, some focusing on the actual models on display at the show, others at the possible future of the Chinese auto industry, and still others at whether the Beijing Auto Show still has a “wow” factor equal to the scale of its production.

Here is a roundup of articles from this weekend about the Beijing Auto Show, and what this it reveals about the current state of the luxury auto industry in China:

Beijing reveals increasingly credible Chinese ambitions (Just-Auto)

The awkward looking designs of yesteryear have largely disappeared from the Beijing Auto Show, which ultimately serves as a giant window into the world of the Chinese Automobile Industry.

On the first day of the show big-hitter car company CEOs were present, including Daimler’s Dieter Zetsche and Renault-Nissan’s Carlos Ghosn. Domestic auto leaders were also evident, including the charismatic Geely leader, Li Shu Fu. The on hand Big Wigs certainly reinforced the rising sense of global prominence for the Auto China show.

Perhaps the most notable point of the first two days of the show were the grim faces of Western and Japanese auto executives – easily spotted by their company logos on their lapels. They went from stand to stand looking grimmer each time they reached a Chinese auto stand.

In previous auto shows they posed with broad self-satisfied grins on their faces, standing against awkwardly designed and clearly inferior Chinese cars. It was reminiscent of colonial hunters posing next to their dispatched big game prey. This time, however, they understood that Chinese cars are better and edging closer to entering their main Western markets.

The only happy looking Western automotive executives we saw were the ones that are in the business of selling luxury cars. Ferrari, Aston Martin, Bentley, Land Rover, and Jaguar all appeared to be doing sterling business and attracting massive crowds to their relatively small stands.

Spyker taps into China’s luxury car market (China Daily)

[Spyker announced in Beijing] Sunday that it has signed an agreement with China Automobile Trading Co. (CATC), one of the country’s major auto importers, to establish a joint venture in China as Spyker’s sole general distributor for its new generation of cars in the region.

Victor Muller, CEO of Spyker Cars, expressed great optimism over China’s growing luxury car market at the signing ceremony, as well as a strong will to find Spyker’s place in the surging market.

Since China has already become the world’s largest auto market, it would be difficult for global auto makers to progress without a clear strategy for the Chinese market, he said.

The joint venture would build a network for Spyker’s sales and after-sale service in China, with supercars, luxury sport utility vehicles (SUVs) and luxury commercial vehicles as its major products, according to the agreement.

China in high gear (Financial Post)

With more than 100 exhibitors from around the world unveiling more than 90 new concept or production vehicles this week, it’s clear that the competition in China is hitting a frenetic pace.

On display here are Volkswagen’s new full-sized luxury sedan, the Phaeton, and Ford’s Start concept vehicle with its “EcoBoost” three-cylinder engine, while General Motors Corp. is showing off 37 production and concept vehicles alone, including the world debuts of its Volt MPV5 electric crossover and its Sail hatchback.

“China is the greatest opportunity for auto sales since the post-WWII era in the United States,” said one industry executive. “Everyone wants a piece of it.”

Beijing Auto Show (Guardian UK)

A gallery of photos from the Beijing Auto Show (16 images) can be viewed here.

Carmakers ‘Unsustainable’ Growth in China Risks Overcapacity (BusinessWeek)

“China’s motorization is reaching the masses,” said Takanobu Ito, Chief Executive Officer of Honda Motor Co., Japan’s second-largest carmaker. “Even after the tax break ends, demand shouldn’t drop very much.”

China’s vehicle sales growth this year will exceed Honda’s original estimate of 10 percent, Ito said at the auto show. Xu Changming, a research director at China’s State Information Center, said last week demand may rise about 17 percent to 16 million vehicles, down from 46 percent last year.

The government is likely to raise consumption tax to 10 percent next year for cars with engines no larger than 1.6 liters, after cutting the rate to 5 percent in 2009 and raising it to 7.5 percent this year, Xu said. Last year’s reduction, which helped Chinese auto demand surge past the U.S. for the first time, resulted in “unsustainable” growth, he said.

Even if the tax break is phased out, “there is a fear that amid all of this investment and stellar growth, the vehicle market could start to overheat,” Paul Newton, a London-based auto analyst at IHS Global Insight, wrote in a research note last week. “The carmakers vying for market share in China may not want to admit it, but this risk is becoming a very real concern.”

Zhang Yi: Why Can We Say That This Beijing Auto Show Is The Most Important In History? (Daily Economic News – Chinese)

There was a lot of media commentary on the eve of the opening of the Beijing Auto Show. Most of the commentary was pretty objective, mentioning both the positive progress made by the show itself while still pointing out some of its flaws. But there was also some noise, people saying that the show was “big but not strong,” “not a world-class auto show,” “simply a copy of the Geneva Auto Show,” and so forth.

What is an auto show anyway? An auto show is not just a platform. It’s a chance for automakers to show off their corporate image, promote their brands, announce new strategies, and show off cutting-edge design and advanced R&D capabilities. It’s a platform for communication and the exchange of information.What we can call top auto shows, in the international exhibition industry and auto industry, can have a broad impact.

Currently the two shows that are the most representative and most recognized by the international automotive industry in China are Auto Shanghai and the Beijing International Auto Show.

Toyota, Honda, Nissan, Mercedes, BMW, Volkswagen, Ford, General Motors, Hyundai and other multinational auto companies are on display at this year’s Beijing Auto show, displaying their latest automotive technologies and products, and many of their new vehicles are getting their world debut at the show.

But Chinese domestic automakers are not to be outdone. Chery, Geely, BYD, Great Wall, Chang’an, Brilliance and other auto manufacturers launched newly developed vehicles at the show, displaying the great progress made by domestic companies in recent years.

Considering its scale, and the level of internationalization on display at this year’s Beijing Auto Show, it will undoubtedly go down in history as the strongest to date. If this kind of auto show isn’t [considered] a “top international auto show,” that would be very strange indeed.

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