On April 16th, according to Caijing News (Reporter: Zhang Yipeng), despite the slowdown of electrification in overseas markets, joint venture brands have finally shown signs of counterattack in response to the strong impact of domestic brands in the Chinese new energy vehicle market.
On April 16th, Honda China officially launched its new electric brand "Yè". Among the three debut models, the Yè P7 and Yè S7, produced respectively by the joint venture companies GAC Honda and Dongfeng Honda in China, will be launched by the end of 2024, while the Yè GT CONCEPT is set to achieve mass production in 2025.
According to the plan, the "Ye" brand will launch six models by 2027, and by 2035, Honda will achieve 100% electrification in the Chinese market.
Alongside the brand launch, Honda's localization efforts in China have also progressed.
Reportedly, the "Ye" brand's models will feature batteries from CATL, with the rare inclusion of Huawei in the supplier list — the new cars will adopt Huawei's XSCENE panoramic screen.
Honda China stated that this marks the first use of Huawei's panoramic screen in a car's passenger seat, which can be linked with sound, light, and aroma devices. Additionally, the "Ye" brand will collaborate with local suppliers such as Hangsheng Electronics and iFlytek.
Honda is not the only joint venture brand gearing up for an electrification "counterattack" in China; Volkswagen's first model in Anhui is also nearing its launch.
In March this year, JAC Motors announced plans to increase capital to Volkswagen (Anhui) by 1.625 billion yuan, with Volkswagen China intending to subscribe to 4.875 billion yuan of Volkswagen Anhui's registered capital. After this capital increase, Volkswagen Anhui's registered capital will increase from 7.356 billion yuan to 13.856 billion yuan, with no change in shareholder ownership. On April 11, Volkswagen China stated that as a key move under the "In China, For China" strategy, they will invest 2.5 billion euros to further expand the production and innovation center in Hefei, while also accelerating the production of two Volkswagen-branded intelligent electric vehicle models jointly developed with Xiaopeng Motors.
Prior to this, Volkswagen Anhui's first model had already been filed in the Ministry of Industry and Information Technology's new vehicle declaration catalog. The new car is a pure electric multi-purpose passenger vehicle, filed by Volkswagen (Anhui) and will be based on the MEB platform, with the model named "ID.UNYX" (Unique), positioned as an A-class coupe-style SUV. "Volkswagen Anhui's first model will be officially unveiled at the 2024 Beijing Auto Show," revealed an insider to Cailian Press.
Despite recent signs of recovery, joint venture brands still find themselves in a passive position in the market overall.
Wang Chuanfu, chairman of BYD, even believes that the accelerated introduction of new energy products by Chinese automakers will erode the market share of joint venture brands. In the next 3-5 years, the share of joint venture brands will drop from 40% to 10%, with 30% of that space being the potential growth for Chinese brands.
The latest data from the China Association of Automobile Manufacturers shows that in March, retail sales of mainstream joint venture brands totaled 500,000 units, down 8% year-on-year but up 49% month-on-month. In March, the market share of German brands was 20.4%, down 1.5 percentage points year-on-year; Japanese brands were 13.8%, down 2.2 percentage points year-on-year; and American brands were 8.2%, down 1.8 percentage points year-on-year.
"At present, joint venture brands are facing accelerated growth from domestic brands, and after domestic brands have overtaken them, consumers' acceptance of electrification is rapidly increasing," said Cui Dongshu, secretary-general of the China Association of Automobile Manufacturers. Due to relatively high taxes on fuel vehicles, joint venture brands are in an unequal competition in the development of fuel vehicles. Electrification is the way forward; "Joint venture brand models have many strengths, but if the weaknesses are not addressed, it will create significant pressure. Joint venture brands must make more effective efforts in the transformation to electrification to achieve sustainable development."
