Chapter 250 A huge gap in the market

Author: corn wine

Chapter 250 A huge gap in the market

Guo Yuan heard what Mr. Lei meant, and he asked tentatively: "Mr. Lei, do you mean that Nanbang Country's cars are no longer competitive?"

"That's right, Mr. Guo was in 2002. If you are still young, you may not remember. I was already working at that time. 2002 was the year when Nanbangguo Automobile officially entered our country.

At that time, the domestic automobile market was dominated by German-Japanese joint ventures.

But these cars were not cheap at that time. Let me give you an example to understand. At that time, the Honda Fit, which was considered very affordable by everyone in the imperial capital, sold for about 100,000 yuan.

This figure seems inexpensive and similar to what it is now, but the purchasing power at that time was very different from now.

In 2002, 100,000 yuan was enough to buy a house of nearly 20 square meters in the third ring road area of ​​the imperial capital.

In the past 20 years, China's GDP has increased tenfold, and housing prices have also increased tenfold, especially in first-tier cities and central urban areas.

Mr. Guo, if you use housing prices as a base for comparison, then buying a Fit was as difficult as buying a Porsche 911 today, which is outrageous."

After listening to Mr. Lei's words, Guo Yuan was a little surprised. It sounded really outrageous.

Nowadays, a house in the Third Ring Road of the Imperial Capital costs an estimated 70,000 to 80,000 yuan per square meter. 20 square meters is not equivalent to a Porsche 911.

"Were Mr. Lei's cars from Nanbangguo very cheap at that time?" Guo Yuan asked.

"It's very cheap. When cars from South Korea came into the market in 2002, the Kia Maxima started out 30,000 yuan cheaper than the Fit, which was equivalent to one or two years' salary of many people at that time.

More importantly, this car was equipped with an automatic transmission at the time. Many people could afford automatic transmission for the first time because of the Nanbang series cars, and I was the same way.

And because of their own local culture, Nanbang has done a very good job in publicity.

In 2004, when Liu Xiang was winning the 110-meter hurdles at the Athens Olympics, Kia immediately signed an endorsement deal.

Leveraging Liu Xiang's fame, Nanbang Car suddenly became a representative of high-end configuration and low price, and became a popular model in China.

At that time, in order to attract investment, the imperial capital also provided Hyundai Motor with a large number of preferential policies and money.

Many taxi companies in Didu also use Didu Hyundai.

There is a popular saying on the Internet now that all high-selling cars are destined to be online car-hailing services. It was the same back then, and they were destined to be taxis.

When I was working in Imperial City, I happened to catch up with the most interesting time for taxis in Imperial City. At that time, Imperial City taxis were divided into three grades.

In addition to the starting price of the lowest-grade Xiali, it is RMB 121km, the Elantra is RMB 161km, and the high-end Hyundai Sonata is RMB 2, etc.

At that time, both Xiali and Beverly were in the phase of elimination, but because Xiali was the cheapest, many people chose it.

The Elantra, which costs RMB 6.00, is not bad, and is relatively competitive. Fukang is the worst. The model is as old as Xiali, but it is a bit expensive, and the comfort is not much better, so there are few candidates.

The most popular choice is the two-price Nanbang taxi.

From this, we can see how wide the coverage of Nanbang series cars was at that time. The key is that the quality of Nanbang cars was also up to standard, and there were few problems when driving, so it won the favor of the mainstream market."

Guo Yuan found it quite interesting to hear these things from a business veteran like Mr. Lei, and Guo Yuan was also willing to give Mr. Lei a personal compliment.

"Mr. Lei, Nanbang Automobile sold so well in the beginning and had such a good reputation. Why can't it do well?" Guo Yuan asked.

"The decline of Nanbang Car was actually doomed from the beginning. At that time, the main focus of Nanbang Car was cost-effectiveness. A large number of successful cases seemed to give Nanbang the illusion that if they wanted to dominate the Chinese market, they had to rely on cheapness.

.”

Guo Yuan's expression became strange when he heard this: "Mr. Lei, aren't they reducing their allocation to the Chinese market?"

"Mr. Guo, you are right. They made an extremely wrong decision. They prepared special models for China, reduced configurations, and continued to compete on price."

Guo Yuan's lips twitched, should he be said to be from Nanbang Country? The way of doing business is the same.

Guo Yuan remembered that the egg yolk pie of a certain Liyou in Nanbang Country that he used to eat had done something similar. It used genuine cocoa butter abroad, but replaced it with substitute cocoa butter in China.

I didn’t expect that cars from South Korea would also engage in such risqué practices.

"What happened next?" Guo Yuan asked.

"In 2016, the sales volume of Nanbang series cars has reached 1.8 million yuan. Faced with competition from friends who are constantly improving their configurations, K3 and Elantra still do not come with ESP as standard, and K2 has low configurations, and even does not include a passenger airbag.

Some models are obviously equipped with self-produced gearboxes such as 6AT8AT, but they must be replaced with dry dual-clutch when they are introduced into the country. They would rather go through the trial preparation and testing again, which will increase a lot of workload, but they must use the outdated gearbox.

Replace it with other technologies and make a low-end and low-cost special version.

In order to keep costs low, the name of Elantra is changed every time a bag is released, and new models and old models are sold together.

There are even Elantra, Yuedong, Langdong and Lingdong, which are sold under the same roof.

This behavior has seriously depleted the brand power of Nanbang Motors, making people think that Nanbang series cars are cheap goods without technology.

Of course, some people who have driven Nanbangguo cars before may say that Nanbangguo cars have good technology, but it is also true that they cut corners later."

"But Mr. Lei, I remember that the global sales of Nanbang's cars are still the third highest in the world, and they are killing everyone in Europe and the United States. Their cars should just not be sold in China, right?" Guo Yuan asked.

"Mr. Guo, this is because you don't know something. Domestic Nanbang national cars and European and American Nanbang national cars are not the same thing."

"I know! Mr. Lei, didn't you say before that Nanbangguo's cars cut corners in China?"

“It’s not just a matter of cutting corners. According to my investigation, Nanbang’s cars now often receive perfect scores in the American Highway Association’s tests and are at the top of the safety list.

However, the Teitu Hyundai Festa, which is a model specially offered in China, suffered a large A-pillar breakage in the 2019 China Insurance Research Institute crash test, and received the worst P grade in the crashworthiness test.

This is a turning point in history when the reputation of Nanban series cars has collapsed. Even if the Festa is a special edition, it can't be so rubbish, right?

Moreover, the Festa is a special model, but the Sonata is the same model worldwide.

As a result, the Sonata, which scored full marks in all categories in the United States, came to China Insurance Research Institute to participate in the 40% frontal offset collision test and the A-pillar broke.

In order to keep costs down and maintain its price advantage, Nanbang Che has even made moves in the field of safety, which consumers will not fail to see.

The most outrageous thing is that Nanbang Car arranges and combines old technologies with a long history and sells them as new cars. High emotional intelligence is called a classic leather test. To put it bluntly, it just doesn’t want to make progress.”

After listening to Mr. Lei's words, Guo Yuan probably understood the reason why Nanbangguo Automobile was in decline.

It's just that Guo Yuan doesn't understand why Nanbang Country does this?

"Is Mr. Lei doing this because Nanbang Country discriminates against the Chinese market, thinking that China is poor and can only afford cheap cars, so it reduces the number of cars?" Guo Yuan asked.

Mr. Lei shook his head when he heard this: "Mr. Guo, your statement seems reasonable, but it is somewhat emotional. You would not give up a profitable business for the sake of discrimination.

We are all businessmen, and making money is the most important thing. How many businessmen can’t get along with money?”

"It seems like a lot, right?"

"Most of them are coerced by zzzq. Over in Nanbang, zzzq can't coerce the chaebol."

"Why is that?"

Mr. Lei smiled and said: "In a word, market problems must ultimately be answered from the market's perspective.

I think the only answer is that the competitiveness of domestically produced cars has become too strong in recent years.

When Nanban cars were at their peak, what were the domestically produced cars? BDF0 DF3, Chery QQ, Geely Beauty Leopard.

At that time, many domestic brands' cars were still popular in volume, but their reputation was not very good.

But just over a decade later, domestically produced cars have now come up with high-end, high-end, and low-end cars, covering all price points below 500,000 yuan, and strive to achieve the highest cost performance at every price point.

The internal involvement of domestically produced cars in Chengdu in the past year or two can only be described as outrageous.

The German BBA can still survive by virtue of its brand value, but the Japanese track of the Nanban BBA has to face the impact of domestic cars head-on.

As the world's largest automobile market, China's competition is obviously the most fierce in the world.

Too many models cannot be sold in the country, but when they are sold in Europe, Southeast Asia, and South America, they are indiscriminately sold.

The main reason why overseas markets are still calm is trade barriers and production capacity.

BYD's Han and Tang series are priced at four to five million yuan in Europe.

MG's market share in the European market has grown rapidly because it still has a certain brand awareness and considerable product strength.

Under the impact of domestically produced cars, the only way for joint ventures to survive is to find ways to use brand awareness, establish a mid-to-high-end image, work hard to climb to the top, or even choose another joint venture.

However, Nanbang National Car may have chosen to reduce configurations and prices because it was afraid of competing with Japanese and German models at the same price, or because of internal disagreements.

At this level, can he compete with domestically produced cars made of hard steel? Obviously he can’t, he doesn’t have the ability!

So the final result can only be that we are beaten by BYD, Geely, Changan and other products worth around 100,000 yuan.”

"So that's it. Mr. Lei's analysis is really thorough!" Guo Yuan expressed his admiration for the senior businessman's vision.

"Mr. Guo was so complimentary. In fact, in addition to competitiveness, there is another reason, and that is that the new energy vehicles in Nanbang are too stretched.

In 2021, the sales volume of new energy vehicles has reached 6.88 million units, and relevant departments predict that the sales volume of new energy vehicles will reach 8.5 million units this year.

This means that if total sales remain unchanged, the share of fuel vehicles will be further eroded by 1.62 million units.

This is equivalent to one or two large fuel vehicle groups disappearing from the Chinese market.

As for the sales of Namba series new energy vehicles in China, I checked specifically. Mingtu sold 177 units in the past year, and Kia's K3EV sold 592 units in the past year.

In recent years, China's automobile market has changed extremely drastically. If the Nanbang series brands have done nothing in new energy, their car sales will also decrease. The huge car vacancy in this market needs new brands of cars to fill, such as our rice car.

.”

Hearing Mr. Lei talk about the market vacancy, and then mention using rice cars to fill the market, Guo Yuan's heart skipped a beat. He seemed to understand Mr. Lei's purpose of coming to the company to find him.
Chapter completed!