SHANGHAI – The Chinese market’s rapid shift to electrified vehicles, especially EVs featuring dynamic digital displays, connectivity and advance driver assistance features, has caught a wide range of automakers off guard. They include most traditional domestic manufactures which are supposed to know the home market well.
With Tesla, China’s largest electrified-vehicle maker, BYD Co., and startups dominating the market for smart EVs, legacy companies have searched hard for ways to catch up.
They have generally come up with two solutions of which the effects have yet to be proved.
One is launching a new school of brands dedicated to smart electrified vehicles.
By doing so, they seek to create a clear distinction between new-generation products and older EV and plug-in hybrid models, which were rolled out several years ago to earn carbon credits as required by the government, not to meet the needs of private users.
The change in strategy is most notable at two major Chinese carmakers – Geely Automobile Holdings and SAIC Motor Corp.
Geely last week unveiled Galaxy, a new brand for smart EVs and plug-in hybrids. It is the third brand the company has created for electrified vehicles.
In 2019, Geely started selling EVs under the Geometry mass-market brand. In 2021, it launched Zeekr as a premium marque for intelligent EVs.
But the two brands have failed to generate sales as expected. In 2022, Geely's sales of EVs and plug-in hybrids approached 329,000. That accounted for 23 percent of the automaker's annual sales, below the industry average of 26 percent.
More worrisome is Zeekr volume; Geely’s first smart EV brand fell short of 72,000 sales last year.
Geely expects Galaxy, which is positioned above Geometry but below Zeekr, to boost its market position as an intelligent-EV maker.
SAIC, in comparison to Geely, derived a higher proportion of sales from electrified vehicles marketed under its proprietary brands. Last year, EVs and plug-in hybrids generated some 243,000 or 29 percent of annual sales at SAIC's passenger-vehicle unit.
But it faces a similar problem as Geely: SAIC volume largely reflected EVs it launched under the Roewe and MG brands several ago.
To better establish itself as a smart EV maker, SAIC has launched two EV brands in the past two years -- R for the mass market and IM as a premium marque, though sales at the two brands remain limited.
Several other traditional Chinese automakers, lacking the ability to develop smart EVs on their own, have unanimously taken a different approach – enlisting the assistance from technology giant Huawei Technologies.
With Huawei’s expertise in areas ranging from electric motors, vehicle controls, infortainment to smart cockpits, BAIC Motor Co., Series and Changan Automobile Co. have rolled out products marketed as smart EVs.
Jianghuai Automobile Co., Chery Automobile Co. and GAC Motor Co. are also seeking Huawei’s help on that front, according to Chinese media reports.
With the latest wave of coronavirus infections eased in China, the Shanghai auto show is set to begin on April 18.
Though few Chinese automakers have disclosed plans for the event, they won’t miss the opportunity to impress visitors with their latest products branded as smart EVs.