China’s Domestic Brands Mark Major Advance in Vehicle Dependability

Dr. Mei Songlin

Dr. Mei Songlin

For a second consecutive year, Chinese nameplates continue to close the gap with international brands in the long-term durability of their models, according to our recent 2012 China Vehicle Dependability Study (VDS). It’s also noteworthy that China’s domestic brands have made advances this year in both initial quality and in offering models that appeal to their new-vehicle owners.

Now in its third year, the 2013 VDS Study measures problems experienced during the past six months by original buyers of vehicles after they have owned their new models for 25 to 36 months. More than 14,100 new-vehicle owners from 37 cities across China were asked to evaluate their new vehicle in terms of 202 different problem symptoms in eight categories.*

This year, the gap in vehicle dependability between the country’s domestic brands and international brands has been reduced to 80 problems per 100 vehicles (PP100), down from 139 PP100 in 2011. Among China’s domestic brands, vehicle dependability in 2012 improves to an average of 250 PP100, vs. 327 PP100 in 2011. International brands also improve their dependability scores, averaging 170 PP100 in 2012, which is 18 fewer PP100 than in 2011. Continue reading ›

Foreign Partners Still Control Branding in China R&D and Lineups

Jenny Gu

Soaring demand for luxury vehicles in China has seen many premium brands make the country their second home. Land Rover may be the next premium brand to begin local production, following on the path taken by Audi, BMW and Mercedes-Benz. Even automakers without a strong foothold in China are increasingly eyeing the country as a key engine for future growth.

Localized Production is Key to Success in China Market

Automakers need to localize in order to truly establish themselves in this market. As some global automakers and their local partners are busy ramping up production of localized luxury models, many other foreign carmakers are seeking Chinese partners, as is required by the government, to set up new joint ventures. Lexus, Infiniti and Land Rover are among those considering localization in China in the near future.

Localization made slow progress before 2009. Between 2005 and 2009, the number of luxury models produced in China rose from just eight to nine. However, in 2010, the number of luxury models that were locally produced climbed to 11, and is expected to reach 15 by the end of 2012. By 2015, we expect 22 luxury models to be locally built, which will mean that those models will account for 60% of luxury sales, up from 56% in 2009. Continue reading ›