The development of independent brands highlights the “altitude sickness” weakness

[Review] In the larger macro environment, the development of independent brands has highlighted the "altitude sickness" fatigue.

Fifteen years after local companies entered the automobile industry like a surge, the survival plight of independent brands really surfaced.

In the first day of August, when the general manager of Chery Automobile Sales Corporation Ma Dejun announced that Ruiqi G6 [Review Photo Forum] was sold for 181,800,000 yuan, the media and distributor representatives of the company fell into silence. After a few seconds of silence, people at the audience began to whisper: How can this car be sold? Is Chery crazy?

As the highest selling price in China except Hongqi HQ3, the start price of the high-end model Ruiqi G6 launched by Chery has already approached the mass-generalized new-generation B-class vehicle in the Chinese market that has just entered the Chinese market. However, it is recognized by the industry that Realtek and the Volkswagen brand, which were born for only three years, are not of a magnitude at all.

If we discuss from the fairness of the rules of the game, the “wrestle” of self-owned brands and joint venture brands is defined as “asymmetric” competition from the very beginning. This time Rui Qi G6's "high price" into the market, at best, is just a microcosm of many local car prices to get rid of the impression of low quality and low price to launch a brand upgrade.

Although product sales are still growing, but market share and product pricing have stagnated, the status of self-owned brands "low-end, low-cost" has not changed significantly. While on the way to the high-end consumer B-level drive, the self-owned brands have been repeatedly defeated and the industry’s people are still feeling guilty.

In the larger macro-environment, the development of independent brands has highlighted the "altitude sickness" fatigue.

“Statistics on the number of new cars from third parties shows that in the first 7 months of this year, the number of licenses for new brands of self-owned brands plummeted by more than 30% year-on-year.” The sales executive of an independent brand automobile company told reporters that in the face of the cruel reality of volume and price declines, autonomy In order to break through the brand's "ceiling," car companies have to withstand the test of "altitude sickness."

The B-class vehicle defense line proves that, for independent brands, the B-class vehicles that represent the demand in the high-end market are an insurmountable “defense line”. The difference in the survival status of car brands inside and outside the defense line is obvious: the joint venture brands have firmly occupied the commanding heights of the market relying on the advantages of the brand and products; and the self-owned brand that has repeatedly launched instincts to the defense line has mostly “taught” the taste of returning.

From Bingchen Zhonghua, who spends 4 billion yuan to build its own brand with a high starting point, to the son of Chery Oriental, and to the Pentium B70 built by FAW Cars based on Mazda 6 [review picture forum] platform and technology, SAIC borrowed the Roewe 750 [Review Picture Forum] created by the Rover platform and Guangzhou Auto's Guangqi Chuanqi [Reviewing Picture Forum] created by Guangzhou Auto's Alfa Romeo platform. Most of the self-owned brand “B plans” had little effect.

“From July to July this year, Chuan Chuan sold about 10,000 vehicles. It turned out that we expect Chun Chuan to sell 30,000 vehicles throughout the year, but now it seems that it should only reach 20,000 vehicles.” GAC Passenger Cars In an interview with the media, manager Wu Song revealed that the company has lowered its sales target for the Chuan model. Wu Song attributed the problem of poor sales to the lack of brand power and the "crowd-up effect" of Japanese car prices.

In fact, Chuanxi is just a “microcosm” of the fate of many self-owned brand B-class vehicles. After reviewing the latest sales statistics, the reporter found that many self-owned brand B-class cars, including Roewe 750, Pentium B70, and Raychem G5 [Reviewing Picture Forum], have generally encountered a “big decline” in sales. Among them, Roewe 750's single-month sales have been in the three-digits for several months, and the Roewe 550 [Review Picture Forum] has dropped by a staggering 52.2%.

[Review] In the larger macro environment, the development of independent brands has highlighted the "altitude sickness" fatigue.

Fifteen years after local companies entered the automobile industry like a surge, the survival plight of independent brands really surfaced.

In the first day of August, when the general manager of Chery Automobile Sales Corporation Ma Dejun announced that Ruiqi G6 [Review Photo Forum] was sold for 181,800,000 yuan, the media and distributor representatives of the company fell into silence. After a few seconds of silence, people at the audience began to whisper: How can this car be sold? Is Chery crazy?

As the highest selling price in China except Hongqi HQ3, the start price of the high-end model Ruiqi G6 launched by Chery has already approached the mass-generalized new-generation B-class vehicle in the Chinese market that has just entered the Chinese market. However, it is recognized by the industry that Realtek and the Volkswagen brand, which were born for only three years, are not of a magnitude at all.

If we discuss from the fairness of the rules of the game, the “wrestle” of self-owned brands and joint venture brands is defined as “asymmetric” competition from the very beginning. This time Rui Qi G6's "high price" into the market, at best, is just a microcosm of many local car prices to get rid of the impression of low quality and low price to launch a brand upgrade.

Although product sales are still growing, but market share and product pricing have stagnated, the status of self-owned brands "low-end, low-cost" has not changed significantly. While on the way to the high-end consumer B-level drive, the self-owned brands have been repeatedly defeated and the industry’s people are still feeling guilty.

In the larger macro-environment, the development of independent brands has highlighted the "altitude sickness" fatigue.

“Statistics on the number of new cars from third parties shows that in the first 7 months of this year, the number of licenses for new brands of self-owned brands plummeted by more than 30% year-on-year.” The sales executive of an independent brand automobile company told reporters that in the face of the cruel reality of volume and price declines, autonomy In order to break through the brand's "ceiling," car companies have to withstand the test of "altitude sickness."

The B-class vehicle defense line proves that, for independent brands, the B-class vehicles that represent the demand in the high-end market are an insurmountable “defense line”. The difference in the survival status of car brands inside and outside the defense line is obvious: the joint venture brands have firmly occupied the commanding heights of the market relying on the advantages of the brand and products; and the self-owned brand that has repeatedly launched instincts to the defense line has mostly “taught” the taste of returning.

From Bingchen Zhonghua, who spends 4 billion yuan to build its own brand with a high starting point, to the son of Chery Oriental, and to the Pentium B70 built by FAW Cars based on Mazda 6 [review picture forum] platform and technology, SAIC borrowed the Roewe 750 [Review Picture Forum] created by the Rover platform and Guangzhou Auto's Guangqi Chuanqi [Reviewing Picture Forum] created by Guangzhou Auto's Alfa Romeo platform. Most of the self-owned brand “B plans” had little effect.

“From July to July this year, Chuan Chuan sold about 10,000 vehicles. It turned out that we expect Chun Chuan to sell 30,000 vehicles throughout the year, but now it seems that it should only reach 20,000 vehicles.” GAC Passenger Cars In an interview with the media, manager Wu Song revealed that the company has lowered its sales target for the Chuan model. Wu Song attributed the problem of poor sales to the lack of brand power and the "crowd-up effect" of Japanese car prices.

In fact, Chuanxi is just a “microcosm” of the fate of many self-owned brand B-class vehicles. After reviewing the latest sales statistics, the reporter found that many self-owned brand B-class cars, including Roewe 750, Pentium B70, and Raychem G5 [Reviewing Picture Forum], have generally encountered a “big decline” in sales. Among them, Roewe 750's single-month sales have been in the three-digits for several months, and the Roewe 550 [Review Picture Forum] has dropped by a staggering 52.2%.

[Review] In the larger macro environment, the development of independent brands has highlighted the "altitude sickness" fatigue.

Fifteen years after local companies entered the automobile industry like a surge, the survival plight of independent brands really surfaced.

In the first day of August, when the general manager of Chery Automobile Sales Corporation Ma Dejun announced that Ruiqi G6 [Review Photo Forum] was sold for 181,800,000 yuan, the media and distributor representatives of the company fell into silence. After a few seconds of silence, people at the audience began to whisper: How can this car be sold? Is Chery crazy?

As the highest selling price in China except Hongqi HQ3, the start price of the high-end model Ruiqi G6 launched by Chery has already approached the mass-generalized new-generation B-class vehicle in the Chinese market that has just entered the Chinese market. However, it is recognized by the industry that Realtek and the Volkswagen brand, which were born for only three years, are not of a magnitude at all.

If we discuss from the fairness of the rules of the game, the “wrestle” of self-owned brands and joint venture brands is defined as “asymmetric” competition from the very beginning. This time Rui Qi G6's "high price" into the market, at best, is just a microcosm of many local car prices to get rid of the impression of low quality and low price to launch a brand upgrade.

Although product sales are still growing, but market share and product pricing have stagnated, the status of self-owned brands "low-end, low-cost" has not changed significantly. While on the way to the high-end consumer B-level drive, the self-owned brands have been repeatedly defeated and the industry’s people are still feeling guilty.

In the larger macro-environment, the development of independent brands has highlighted the "altitude sickness" fatigue.

“Statistics on the number of new cars from third parties shows that in the first 7 months of this year, the number of licenses for new brands of self-owned brands plummeted by more than 30% year-on-year.” The sales executive of an independent brand automobile company told reporters that in the face of the cruel reality of volume and price declines, autonomy In order to break through the brand's "ceiling," car companies have to withstand the test of "altitude sickness."

The B-class vehicle defense line proves that, for independent brands, the B-class vehicles that represent the demand in the high-end market are an insurmountable “defense line”. The difference in the survival status of car brands inside and outside the defense line is obvious: the joint venture brands have firmly occupied the commanding heights of the market relying on the advantages of the brand and products; and the self-owned brand that has repeatedly launched instincts to the defense line has mostly “taught” the taste of returning.

From Bingchen Zhonghua, who spends 4 billion yuan to build its own brand with a high starting point, to the son of Chery Oriental, and to the Pentium B70 built by FAW Cars based on Mazda 6 [review picture forum] platform and technology, SAIC borrowed the Roewe 750 [Review Picture Forum] created by the Rover platform and Guangzhou Auto's Guangqi Chuanqi [Reviewing Picture Forum] created by Guangzhou Auto's Alfa Romeo platform. Most of the self-owned brand “B plans” had little effect.

“From July to July this year, Chuan Chuan sold about 10,000 vehicles. It turned out that we expect Chun Chuan to sell 30,000 vehicles throughout the year, but now it seems that it should only reach 20,000 vehicles.” GAC Passenger Cars In an interview with the media, manager Wu Song revealed that the company has lowered its sales target for the Chuan model. Wu Song attributed the problem of poor sales to the lack of brand power and the "crowd-up effect" of Japanese car prices.

In fact, Chuanxi is just a “microcosm” of the fate of many self-owned brand B-class vehicles. After reviewing the latest sales statistics, the reporter found that many self-owned brand B-class cars, including Roewe 750, Pentium B70, and Raychem G5 [Reviewing Picture Forum], have generally encountered a “big decline” in sales. Among them, Roewe 750's single-month sales have been in the three-digits for several months, and the Roewe 550 [Review Picture Forum] has dropped by a staggering 52.2%.

At the same time, due to the substantial price cuts of the old models, the sales of the Pentium B70 [Summary Picture Forum] have been declining all the way, from 4,763 in January to 1989 in May, and the cumulative sales of the Pentium B70 in the first five months of the year were about 15,000 vehicles, down 36.13% year-on-year. Its share in the segment of the model range of RMB 130,000 to RMB 170,000 also decreased from 5.66% in 2010 to 1.73%, and its market share shrank significantly.

“The Pentium B70 is already a waste of money, dealers can only rely on sales later to maintain.” The head of a Beijing Pentium dealership store told reporters that the intensified market competition is the main factor in Pentium sales decline. The reason is that on the one hand, the independent brands including Pentium have a certain reputation, but the market reputation has not been significantly improved. On the other hand, the joint venture brand has increased the B-class car offensive.

The Ruiqi RIICH brand, which represents Chery’s launch of the mid- to high-end car market and has only been established for three years, also faces similar difficulties. From the brand strategy release in 2009 to the end of the year when the first product Ruiqi G5 [review picture forum] entered the market, Ruiqi brand is not ideal for sales. So that last year, Ma Dezheng, the general manager of Chery’s sales company who received the Ruiqi brand, had to open up the “big net sales of Chery”.

Do you compromise on the market?

In front of the harsh reality, how should independent brands break through the "defense line" of Class B vehicles?

"Some people said that the entry of independent brands into the mid-to-high end market may be for death; but we firmly believe that if this market is surrendered, then the self-owned brand is to die." In the face of independent brands can only stick to the following low-end products in the A-class car The status quo, the boss of an independent car company so sighed. According to reports, independent brands including FAW Pentium, SAIC Roewe (Weibo), Chery Riich and Guangzhou Auto Chuanqi [review picture forum] are reluctant to give up the Class B market.

Among them, Chen Zhixin, Executive Vice President of the SAIC Group’s own brand passenger vehicle business, stated on a recent statement that SAIC will invest 22 billion yuan in the entire “Twelfth Five-Year Plan” period to the independent brand Roewe on the basis of more than 20 billion yuan investment. And MG (microblogging) to build two brands. At the same time, FAW, GAC and Chery will invest heavily in the creation of independent brands for the mid- to high-end market during the “12th Five-Year Plan” period.

The advent of the Ruiqi G5 did not deter Chery’s determination to enter the high-end market. Xie Baoxin, vice president of the Chery Automobile Engineering Research Institute, responsible for the development of the vehicle in Ruiqi G6 [Review Picture Forum], told reporters that Rui Qi was prepared to use the efforts of several generations of vehicles to overcome the "fortress" of the B-class car market. “The experience of successful brands proves that it is impossible to build a B-class vehicle and it will take a few generations before it can be obtained.”

This is the reason why Chery still firmly launched the deep-rooted reason for positioning the higher-end Ruiqi G6 on the premise that Ruizhi G5 sales did not achieve the expected results. It is reported that as the Ruiqi brand top flagship model, Ruiqi G6 R & D process lasted four years, costing more than 100 million US dollars, from the entire vehicle modeling, chassis tuning, production equipment and supplier selection, all from the internationally renowned first-tier companies.

For example, the Ruiqi G6 model was designed by Broadcom, one of the four most famous Italian car design companies. The chassis tuning was completed by the British Lotus. The electronic and electronic control of the vehicle were respectively matched by Delphi and the Bosch Group. Turbocharger technology of the turbo engine was Provided by Honeywell of Honeywell, Switzerland, and the automation equipment of Realtek G6 was purchased from KUKA, Germany.

Although wearing a "brand name", but because of Ruiqi G5's "wholesale", Chery sales company executives are particularly cautious when talking about Ruiqi G6 sales target. The general manager of Chery Sales Company, Ma Dejun, told the reporter that the company did not give the Ruiqi G6 a hard sales target, but there will still be an assessment target within the company, but this goal is temporarily not open to the public.

At the same time, the reporter learned from Chery’s internal understanding that Chery will launch the “Impulse” Ruiqi G3 in the second half of the year. The platform of this model is derived from the Chery A5 (now renamed the Qiyun 3 [review picture forum]) and is shared with the Qiyun E5 and other products. Technology platform, and this will greatly reduce the new car development costs of Ruiqi G3. "In the future, Ruiqi G6 [Review Photo Forum] will focus on upgrading the brand. G5 and G3 will shoulder the heavy sales."

Although the objective of the difficulties facing the adversity is clear, the road ahead is still full of difficulties for the independent brands entering the mid-to-high end market.

Zhang Zhiyong (microblogging), an independent analyst in the auto industry, told reporters that it is most appropriate to describe the plight of self-owned brands with “backwater”: On the one hand, the joint-venture brand product line is under pressure, and the price advantage of the A-class car market held by independent brands is gradually being lost; On the other hand, in positioning the higher-end B-class car market, independent brands must also attack the joint venture brands that both technology and brands have "innate advantages."

Under the premise that the auto market as a whole continues to grow, the declining momentum of self-owned brand cars has already emerged. According to the latest statistics from China Automobile Association, from January to July, the sales of self-owned brand passenger cars reached 3.534 million, a year-on-year decrease of 1.03% (the overall sales of passenger cars increased by 6.74% year-on-year), accounting for 43.37% of the total sales of passenger cars. The share has decreased by 3.06 percentage points from the same period of last year.

Market analysts told reporters that in the sales of high-end products, the decline in self-owned brands far exceeded the decline in overall sales and market share.

A typical example is that in the past few years, many self-owned brands, including Brilliance China, Chery Ruiqi and SAIC Roewe, have launched turbocharged engines for high-end consumer groups, but These self-owned branded products with 1.8T or 2.0T engines soon suffered from "unsatisfactory sales" after being listed.

"Actually, since 2008, the amount of customers' purchases has been declining year by year. Now, the purchase volume of independent brand customers is almost negligible in comparison with joint venture brands." Honeywell, which supplies turbochargers for domestic car manufacturers Gao Dinggui, president of Seoul China, told reporters that in contrast with the popular brands such as the Volkswagen Group and the T models, the self-owned brand with the T models could not be sold at all.

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