Home https://server7.kproxy.com/servlet/redirect.srv/sruj/smyrwpoii/p2/ Business https://server7.kproxy.com/servlet/redirect.srv/sruj/smyrwpoii/p2/ In China, a little – known electric car maker leaves Tesla powder News from the automotive industry

In China, a little – known electric car maker leaves Tesla powder News from the automotive industry

Since July last year, a little-known carmaker in southwest China has dominated the world’s largest electric car market, selling larger players and even Tesla Inc. almost every month. with a small, clean EV bone that starts at just $ 4,500.

Hongguang Mini is an idea of ​​SAIC-GM-Wuling Automobile Co., a joint venture between SAIC Motor Corp. and Guangxi Automobile Group Co., two state-owned carmakers, and US giant General Motors Co.

Based in Liuzhou, famous for its limestone mountains and snail soup, the company – which has sold about 270,000 cars in nine months, making it the best-selling EV in China – has even bigger ambitions for the future. . Its goal is annual sales of 1

.2 million cars next year, almost equal to the number of electric cars produced by Chinese carmakers in 2020 combined.

This is an eyebrow-raising goal, but even before the Hongguang Mini, Wuling had experience in producing market winners that set a new era of driving. Founded in 2002, the Sino-US JV built its microwave business: reliable workhorses with sliding doors that earned the nickname “bread car” in mandarin and were the best-selling passenger vehicles in China in 2017. Millions of them travel roads in the country, used by contractors and delivery drivers.

The buyers of these aerated gray vans are almost exclusively men, which makes Wuling’s rotation to the Hongguang Mini – which has a top speed of 100 kilometers per hour and 12-inch wheels – even more unusual. Shortly after its debut last July, the carmaker realized that the car was winning after young women, a phenomenon it leaned toward with an approach that distorted the common wisdom about how cars are sold.

“Our company’s mentality is to produce everything that people need,” said Zhang Yiqin, Wuling’s head of branding and marketing. “We are closely monitoring our customers. Obstacles to the acceptance of electric cars can only be removed when consumers find it convenient to use them.

To that end, Zhang has equipped his team with employees who understand the Hongguang Mini’s customer base, which is currently about two-thirds female. At age 35, he jokes that he is the group’s oldest statesman, averaging about 27. Slogans such as “Young and Eager” are sprayed on the walls of Wuling’s headquarters in Liuzhou, a city that embraces EV with the company. 30% of all car electricity sales last year, the highest percentage in China, according to WAYS Information Technology.

Wuling’s success with the Hongguang Mini is due to a targeted marketing campaign conducted almost entirely online, according to Zhang. His team often communicates with users directly through various social media platforms and it was at the customer’s request for more nuances that the company came up with the latest iteration of the Hongguang Mini – Macaron. Available in avocado green, lemon yellow and white peach pink, with an optional one-color contrast roof to mimic vanilla butter cream, which sandwiches French meringue confetti of the same name.

They also landed at one of the key points of sale for the car – apart from the price point below: Hongguang Mini drivers can customize their vehicles in a way that is not possible elsewhere.

Using “stickers”, the car’s panels and body can be transformed. Some have fun with Nike, some have galaxy-like space scenes, and others have cartoon characters from Hello Kitty and Doraemon. The original Hongguang Mini is available in about 20 different basic colors that can be switched, and buyers can also customize the interior.

Zora Zhang (no connection) is a typical client. The 23-year-old is a fan of Hayao Miyazaki, the Japanese animator who directed “My Neighbor Totoro,” a fantasy film starring a character named The Catbus, a grinning cat whose seats are covered in fur.

She built her Hongguang Mini to look like it, spending about 15,000 yuan ($ 2,300) to cover the car’s interior with brown velvet and showering the roof with lights that sparkle at night.

“A lot of my friends have a Mini, you see them everywhere in Liuzhou,” said Zhang, who lives with her parents (they drive a BMW sedan). “I love things that reflect my character. I can change the look of the car again if there are other things I like. “

As frivolous as it may seem to turn a set of wheels into a fashion accessory, there is a very real market for grabs.

Outside Liuzhou, the penetration of electric cars in China is still only about 6%, and competition is fierce. The Tesla name may sound strongest, especially in larger cities such as Beijing and Shanghai, where its first Gigafactory is located, but many new, local players from Nio Inc. to Xpeng Inc., Li Auto Inc. and WM Motor are a crowd in.

At the same time, other home-grown players such as BYD Co., a long-backed carmaker by Warren Buffett, are improving their EV game, and international giants such as Volkswagen AG are investing billions of dollars in new electric trains.

Consumers in China are overwhelmed by the choice, when fossil fuel cars are added to the mix, carmakers have to give motorists what they want to survive, said Jochen Siebert, managing director of consulting firm JSC Automotive in Singapore.

“SAIC-GM-Wuling has to come up with new ideas all the time to attract consumers,” Siebert said. The Hongguang Mini is “a kind of accessory, which means it’s a fashion item that may go out of style sooner or later.”

For now, this is a strategy that pays dividends to Wuling. The company, which owns 50.1 percent of Shanghai-based SAIC, 44 percent of GM’s Chinese division and 5.9 percent of Guangxi Automobile, sold a total of 1.6 million cars last year. While this was about 4% from 2019 against the backdrop of the pandemic, sales of new Wuling energy vehicles almost tripled to 174,000 units.

For GM – which doubles electrification and autonomous driving under CEO Mary Barra – the Hongguang Mini seems to be a boon. The automaker saw revenue of $ 9.9 billion from its Chinese joint ventures in the first quarter of last month, compared to $ 4.3 billion in the first three months of 2020. GM, which has several other partnerships in China , does not break Wuling revenue in its financial results.

While customer engagement distinguishes the Hongguang Mini, price is the main driver of its sales in the country, where many find the price of the Tesla Model 3 sticker, which sells for the equivalent of $ 39,300, out of range. The main Hongguang Mini starts at $ 4,500, and even the new Macaron sells for less than $ 6,000.

Wuling was able to produce cheap cars thanks in part to good supply chain management, enhanced by the super-popular vans. Many of Wuling’s suppliers have also set up production facilities in Liuzhou, which has helped to further reduce costs. This is a model that is being replicated by car companies in other cities and provinces in China, flattering to Wuling, but also challenging as the price of competitors’ cars falls.

Multinational carmakers are also watching the compact EV space, with Daimler AG set to make an electric version of the Smart – for many, the perfect small car – in China with its own partner.

The global shortage of semiconductors also weighs heavily on Wuling, with the Hongguang Mini, although a major EV, still requiring more than 100 chips. Hongguang Mini production is affected by shortages, with Macaron production expected to decline by about 15% in May, according to Zhang.

The big goal of sales for 2022 is the cornerstone of Wuling’s plan to maintain its leading momentum in the market. Following the debut of the Hongguang Mini Convertible at the Shanghai Motor Show in April, it aims to release an improvement in the mid-cycle of the car later this year and is working on a two-seater EV aimed at younger men, Zhang said.

At Wuling’s office in downtown Liuzhou, consumer experience manager Li Zhengguang says he has a team of four focused solely on new media. They communicate with potential customers using Douyin, as TikTok is known in China, and Little Red Book, a trusted social shopping platform popular with young women, sharing photos and videos. Lee, who has previously sold diamond engagement rings, says there is not much difference between jewelry and cars. Create a desire for a cool product and buyers will come, he says.

The installation of the Hongguang Mini is not like a cheap car, but the desired accessory in the China brand is brilliant, said Siebert from JSC Automotive.

“This has become a hallmark of SAIC-GM-Wuling over the last 20 years to always surprise the market and itself,” he said. “They did extremely well because they focused on the right things. About quality, when they mainly produced microwaves, and now marketing. “

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