After years of consecutive growth and record highs, the Chinese auto market appears to be shrinking as the economy slows. At the same time, U.S. automakers face a smaller market share.
Bloomberg reported Tuesday that market share for U.S. brands dropped to just 10.7 percent, down from 12.2 percent in 2017. The Chinese auto market saw sales drop three months in a row as a stalling economy applies the brakes to country’s three-decade-long expansion. The China Association of Automobile Manufacturers said U.S. brands saw drops due to stale vehicle lines sitting in showrooms.
Xu Haidong, the association’s assistant secretary general, said Ford and GM haven’t refreshed their vehicle lineups in a timely manner. He added the U.S.-China trade war has not affected consumer sentiment, either. There haven’t been boycotts surrounding American cars, he said to further underscore the need to introduce new models.
The report noted a small percentage of cars sold in China are actually imported into the country, but retaliatory tariffs by the Chinese government on the U.S. have caused “pricing uncertainties” and kept Chinese buyers out of showrooms.
In the second quarter, General Motors said growth slowed to 0.7 percent but didn’t offer any greater details on its picture of the Chinese auto market. GM added it calls the Chinese situation a “softening” of the market. Ford, on the other hand, saw sales plunge 36 percent in August.
China has become an epicenter for GM profits in recent years. As the automaker continues to retreat from long-time markets, the company’s view has widely become one focused on North America and China. Brazil has also offered beacons of hope as the local economy recovers from a recession.
In the near future, GM plans to introduce 20 new electric cars by 2023 and it’s more than likely we’ll see all 20 models find their way to Chinese showrooms before North America.