China sold more cars to Russia than Japan after West dumps Moscow business

  • Foreign automakers have struggled to maintain their position in China, raising questions about their long-term future in the country.
Made in China Volkswagen cars wait to be exported from Shanghai port. (File image)
Made in China Volkswagen cars wait to be exported from Shanghai port. (File image)

China sold more cars abroad than any other nation in the first quarter in part because of a sales jump to customers in Russia. The Asian country exported 1.07 million vehicles in the three months through March, overtaking long-time leader Japan, consultancy AlixPartners said Monday. China delivered 112,000 vehicles to Russia — roughly the same amount it sold there during all of last year. Western automakers have largely abandoned shipments to Russia over its invasion of Ukraine.

The success of Chinese brands elsewhere in Europe and the US remains limited — they sold just 900,000 vehicles there last year. Still, the consultancy expects China’s shipments to those markets to jump 67% by 2026 as companies including BYD Co. and Xpeng Inc. bolster their efforts to expand abroad.

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“We believe now is the time Chinese brands begin their disruptive influence on Western markets," Stephen Dyer, managing director of AlixPartners in Shanghai and a former Ford Motor Co. executive, told reporters.

The group projects global light vehicle sales to climb 5% this year, mainly on surging demand for electric cars. It’s seeing a 10% jump in the US, 6% growth in Europe and 3% expansion in China.

Also Read : China’s electric vehicle bubble starting to deflate? Startups find it tough to take on Tesla, BYD

In the world’s biggest auto market, homegrown carmakers will likely outsell their foreign rivals for the first time this year in over four decades, AlixPartners said, adding that local brands are better at delivering what tech-savvy younger buyers want.

Foreign automakers have struggled to maintain their position in China, raising questions about their long-term future in the country. Business for the likes of Volkswagen AG and General Motors Co. has become more challenging as local rivals roll out a slew of electric models.

First Published Date: 27 Jun 2023, 08:41 AM IST
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