China’s Auto Exports Flourish in Russian Market
The Chinese automotive industry is making remarkable progress in expanding its global market presence, with Russia emerging as a prominent destination for Chinese-made cars. According to the China Association of Automobile Manufacturers (CAAM), Russia has now become China’s primary export market for cars, with an impressive export volume of 287,000 units during the first five months of the year. This was followed by Mexico with 159,000 units and Belgium with 120,000 units.
Notably, the export of new-energy vehicles (NEVs) has witnessed significant growth in Chinese auto exports. Within the same period, NEV exports reached an impressive figure of 673,000 units, representing a 1.2-fold increase. The top destinations for China’s NEV exports are Belgium, the UK, and Thailand, encompassing various types of vehicles such as plug-in hybrid (PHEV), battery-electric (EV), and range-extender (EREV) vehicles.
Data provided by CAAM reveals that Chinese auto exports for the month of June alone reached a remarkable 382,000 units, showcasing a notable year-on-year increase of 53.2%. Over the first half of the year, the total number of auto exports amounted to a substantial 2.14 million units, representing a remarkable surge of 75.7% compared to the previous year. As a result, China has surpassed Japan and has now become the world’s largest vehicle exporter as of the first quarter of 2023.
Xu Haidong, a deputy general engineer of CAAM, attributes the increasing competitiveness of China-made vehicles in the global market to stringent quality control measures, a well-established industrial chain, and comprehensive maintenance services.
When considering the context of Chinese auto exports to Russia, Cui Dongshu, the secretary general of the China Passenger Car Association (CPCA), emphasizes the opportunity that has emerged for Chinese automakers due to the withdrawal of Western auto brands from the Russian market. The improved competitiveness of Chinese cars has further contributed to their growing presence in Russia.
Industry estimates from Otkritie Auto, the auto business unit of Russia’s Otkritie Bank, project that Chinese car sales in Russia could reach a remarkable figure of up to 400,000 units by the end of 2023. Chinese automakers currently operate nearly 1,500 dealerships in Russia, accounting for 46% of the country’s total. Prominent Chinese auto brands such as Chery, Haval, and Geely have gained significant popularity in the Russian market.
While the domestic Chinese auto market has been experiencing a steady recovery, the momentum in China’s auto exports has remained strong throughout the year. In a noteworthy occurrence over the past 20 years, China’s passenger vehicle sales have consistently increased month over month from February to June. Retail car sales in June reached an impressive figure of 1.9 million units, reflecting an 8.7% increase compared to the previous month. However, there was a 2.6% decline in sales on a year-on-year basis, primarily attributed to the high comparison base from June of the previous year.
Cui predicts that China’s vehicle exports will experience a significant boost in the current month, benefiting from the favorable exchange rate of the yuan in the international currency market. China’s Ministry of Commerce has also outlined plans to further promote vehicle exports, encouraging automakers to collaborate with both local and foreign financial institutions to provide financing solutions. Moreover, there is a strong emphasis on enhancing the overall quality of exported vehicles to sustain and enhance China’s position as a leading vehicle exporter.