Car Makers' Price War In China Narrows Margins
A scramble among the world's top car makers to capture a share of the booming Chinese market is fueling fierce price competition that threatens to erode the fat profit margins car makers currently enjoy.
Gathering in Detroit for the annual North American International Auto Show, executives of the world's biggest car makers say price competition is growing in China as consumers grow more savvy and auto makers flood the market with new models.
Car makers don't expect the narrowing profit margins to end soon. Nissan Motor Co. Chief Executive Carlos Ghosn said he expects car prices in China to fall 3% or more annually for the next four or five years.
Early entrants to the Chinese market, such as Volkswagen AG and General Motors Corp., for years have been able to charge premium prices for their cars in China because of a lack of competing models and because they sold mostly to China's wealthiest consumers. But as more manufacturers enter the market and go after a broader range of consumers, price premiums that once were 30% or more are disappearing quickly, auto executives say. Also, Chinese consumers have become increasingly sophisticated, combing the Internet and car magazines for information on coming models and prices.
After years of building businesses in China and nearby countries, GM has found in Asia an important source of profit. The company reported earnings of $162 million in its Asian auto operations for the third quarter last year, or about $1,200 per vehicle sold, compared with net income of $128 million in North America, or $102 per vehicle sold.
VW relied on China for about 80% of its earnings during the first half of 2003, according to a November report of Goldman Sachs.
"You are dealing with a market that's going like a rocket, and at the same time, prices are falling," said VW Chief Financial Officer Hans Dieter Poetsch. Among the reasons for this anomaly, he says, is the rush by car makers to grab market share while growth is booming. "The newcomers are extremely aggressive on the price side," he said.
Mr. P?tsch said VW is dealing with the pressure in part by putting pressure of its own on its Chinese suppliers -- many of which are affiliated with VW's Chinese car-making partners. Sales of cars built in China rose 68% during the first 11 months of 2003 to 1.8 million vehicles, according to Automotive Resources Asia. Industry executives say China is likely to have finished last year as the third-largest single-country market in the world, behind the U.S. and Japan.
Ford Motor Co. Chairman and Chief Executive William Clay Ford Jr. said falling prices in China are inevitable, given the rush of manufacturers building plants. "There are a lot of people chasing the holy grail there," he said. "By some measures, there clearly is overcapacity in China."
The big question facing Ford in China is "Do you want to make money or grab share?" Mr. Ford said. And so, Ford has decided to take "a rational-cautious approach" and won't spend a lot to boost its production capacity in China, he said.
The price reductions span most segments of the market, but the most aggressive cuts last year came on midrange cars and jeeps, according to Automotive Resources Asia. DaimlerChrysler AG's Beijing Jeep venture slashed the price of one version of its Cherokee model 29%. Honda Motor Co. reduced the price of its Accord 2.4L 13%, while VW came down 8% on the price on a standard Santana.
In 2002, price cuts were frequent and intense, but profits remained strong, according to Geoff Liu, chief representative in Beijing for Automotive Resources. These days, however, profits appear increasingly elusive. "Some dealers are claiming they aren't making a profit at all," Mr. Liu said.
世界汽车巨头在华掀起价格战
为争夺中国繁荣的汽车市场，全球领先的汽车制造商竞相在中国发起激烈的价格大战，它们原本享有的丰厚利润受到威胁。
在底特律每年一度的北美国际汽车展(North American International Auto Show)上，全球最大的几家汽车制造商的高层人士表示，随著中国的消费者越来越精明，大量的新车型涌入中国市场，中国的汽车价格竞争愈演愈烈。
汽车制造商预计，利润越来越微薄的趋势不会很快结束。日产汽车(Nissan Motor Co.)首席执行长卡罗斯(Carlos Ghosn)预计，未来4或5年中国的汽车价格每年将下降3%或更多。
日产汽车在中国投入巨资，希望通过与中国国有企业东风汽车有限公司(Dongfeng Motor Corp.)的合作，在2010年前将汽车年销量从去年的几千辆增加到90万辆。尽管汽车价格在下降，卡罗斯仍乐观地相信，日产汽车在中国的投入将得到回报。
卡罗斯说，中国的汽车市场将继续增长，汽车价格还将下降。汽车企业面对的挑战是，如何更快地降低成本。
率先进入中国市场的国际汽车公司，如大众汽车(Volkswagen AG)和通用汽车公司(General Motors, Corp.)等，多年以来在中国市场的销售价格一直居高不下。这一方面是由于市场缺乏与之竞争的车型，另一方面是由于它们的主要销售对象是中国的富人阶层。不过，随著越来越多的汽车制造商进入中国市场，面对不同层次的消费者，一度在30%或以上的价格溢价开始迅速消失。趋于成熟的中国消费者也在通过互联网和汽车杂志等途径，了解新车型和价格的相关信息。
通用汽车董事长兼首席执行长瓦格纳(Rick Wagoner)表示，降价表明利润存在下滑风险，但通用汽车目前还没有遇到这种问题。他相信通用汽车及其供应商能够很快降低生产成本，以保持合理的利润率，汽车销量同时也将继续增加。
日产汽车在中国的合资公司东方汽车总裁中村克己(Katsumi Nakamura)预计，到2006年中国汽车价格将降低到其他主要市场的水平。
亚汽资源公司(Automotive Resources Asia)表示，降价波及汽车市场的多个领域，但去年降幅最大的当数中型汽车和吉普车。戴姆勒-克莱斯勒(DaimlerChrysler)在中国的合资公司--北京吉普汽车有限公司(Beijing Jeep venture)将一款切诺基车型价格下调了29%。本田汽车(Honda Motor Co.)的雅阁(Accord)2.4L汽车降价13%，而大众将普通桑塔纳车型降价8%。
亚汽资源公司驻北京的首席代表Geoff Liu表示，尽管2002年的降价风潮也很频繁、猛烈，但公司利润仍是可观的。不过最近以来，利润问题似乎越发令人难以琢磨，某些汽车经销商表示他们根本赚不到钱。 经销商们抱怨，为争夺市场占有率，他们被迫降低销售价格。经销大众、通用和本田汽车的北京申银汽车销售有限公司(Beijing Shen Yin Auto Sales Co.)总经理沈东升说，他们当然还可以保持汽车制造商原来的价格不变，但只有傻子才会那样做。
对大众汽车等大型汽车制造商来说，销售竞争尤其激烈。高盛(Goldman Sachs)在11月份的报告中指出，大众汽车在中国客车市场的市场占有率最大，2003年上半年大约80%的利润来自中国市场。不过，大众汽车在北京的一位经销商称，经销大众汽车的利润几乎已经降为零。
罪魁祸首就是汽车经销商过多。北京共有40多家大众汽车经销商，是上海通用(Shanghai GM)经销商数目的10倍。竞争迫使经销商打出比汽车制造商自身降价更大的折扣。一位大众汽车经销商说，汽车厂商根本不在乎他们能赚多少钱，他们之间的竞争越激烈，对汽车厂商的品牌和销售来说就越有好处。
