New platform to help Chinese automobile industry go global

China National Vehicles Import & Export Co Ltd, a Beijing-headquartered company wholly owned by China General Technology (Group) Holding Co Ltd, is going to build a platform for Chinese automobiles going global, according to the company's top management.

"With the rapid development of China's auto industry, especially electric vehicles, now is a good time for the Chinese auto manufacturers to go global," said Gu Chaogang, general manager of China National Vehicles Import & Export Co Ltd.

China's automobiles exports have been strong in recent years. According to the General Administration of Customs, the country's automobile export has reached 1.91 million in the first eight months of 2022, making it the world's second largest automobiles exporter, only next to Japan.

"With the rapid development of the industry, automobile export is expected to enter an explosive growth period in the next few years. And we are going to grasp this opportunity," said Gu.

According to Gu, the rapid growth of China's automobile exports is mainly based on the following advantages: good product quality, stable supply chain and a good global layout strategy of the leading automobile companies.

"We are committed to building an overseas service platform for Chinese automobiles going global, through which they can enjoy our financial supporting services, domestic product supply chain and overseas market layout," said Gu. "In other words, we would like to be an incubator creating more opportunities for Chinese automobile manufacturers, especially those smaller ones, to accelerate their global expansion".

Gu believes that an overseas warehouse business model plays an important role in this process. It integrates multiple functions like financial services, government relations coordination and industry research. Taking financial supporting services as an example, the traditional deposit transaction mode cannot avoid the risk caused by the fluctuation of shipping costs, while the flexible scheduling mode based on the overseas warehouse platform can effectively avoid the risk, alleviate the price fluctuation and also provide a guarantee for the medium and long-term development of the market.

In terms of overseas market selection, the traditional top choices for Chinese automakers are Chile and Brazil in South America, Russia, the Middle East and North Africa, according to Gu.

"So far, South America is still an important market, but companies are starting to put more emphasis on Europe as well," said Gu.

"On one hand, Europe lags behind China in developing electric vehicles, so there will be more opportunities. On the other hand, entering the European market will bring a demonstration effect. Moreover, the business environment is also friendlier in Europe," said Gu.

Statistics from the China Association of Automobile Manufacturers show that the export of China-made automobiles has exceeded 2.12 million in the first three quarters, surpassing the figure of 2021 (2.01 million). The export of new energy vehicles hit 389,000 units, up more than 100 percent from a year earlier and accounting for 18.4 percent of all kinds of vehicles exporting. The top five export destinations are Mexico, Chile, Saudi Arabia, Belgium and Australia.

Zhang Ying contributed to this story