In 2023, Chinese cars performed exceptionally well in the Russian market.
According to statistics, Chinese companies sold approximately 950,000 various types of vehicles in Russia in 2023, accounting for about one-fifth of China's annual car exports.
In the Russian market, Chinese cars are gradually replacing European and American brands and are overwhelming local brands. It can be said that Chinese cars are "sweeping" the Russian market.
There are two main reasons for the significant success of Chinese cars in Russia:
Firstly, due to the impact of the Russia-Ukraine war in 2022, Western countries imposed severe comprehensive sanctions on Russia, causing many Western car companies to withdraw from the Russian market.
Companies that once led sales in Russia, such as South Korea's Kia and Hyundai, and Japan's Toyota, were also forced to withdraw due to political factors.
In contrast, the Russian domestic auto industry could not meet local demand, so Chinese cars quickly filled this huge market gap.
Due to political factors, Chinese cars have significant advantages in the Russian market:
Although some European and American brand cars are still available in Russia, these brands face restrictions in maintenance and parts supply, with repair times extending to several months or even more than a year, and some parts are even unavailable.
Chinese cars, on the other hand, have faster response times in after-sales service and are not subject to these restrictions.
Secondly, China's auto industry has made significant technological breakthroughs in recent years, enabling it to compete in the international market.
According to data from the General Administration of Customs, China exported a total of 5.221 million vehicles in 2023, surpassing Japan's 4.3 million and ranking first in the world.
The success of Chinese cars is closely related to the upgrading of their industrial technology, especially in the field of new energy vehicles. With the support of companies like CATL and Huawei, Chinese cars have an advantage in terms of cost performance, allowing them to compete with Western companies.
These factors suggest that Western and Japanese-Korean car companies may permanently lose this important share of the Russian market.
Tesla founder Elon Musk's evaluation of Chinese car companies is quite representative.
He stated in a Tesla earnings conference that Chinese car companies are the most competitive globally, and if there were no trade barriers, Chinese car companies would defeat all foreign competitors.
This evaluation is high praise for the progress of Chinese car companies and explains why Chinese car companies have a "dimensional reduction strike" on the Russian market.
Russian local car companies' technological level still remains in the Soviet era, unable to compete with Chinese car companies, with at least a 25-year technological gap.
However, the successful situation of Chinese car companies in the Russian market in 2023 changed in 2024.
To protect the local auto industry, Russia began to increase import taxes on cars and set stricter import standards, allowing only qualified cars to enter the Russian market.
At the same time, due to the large number of Chinese car companies entering the Russian market, competition intensified, leading major Chinese car companies to start price promotions, and about 175,000 Chinese cars remained unsold, indicating signs of market saturation.
In the future, the development of Chinese car companies in Russia may no longer rely on exporting complete vehicles but on establishing factories in Russia to achieve local production and sales. This will transform "Made in China" into "Made in Russia" to meet the demands of the Russian market and protect the local industry.
As Musk said, as long as there are no trade barriers, Chinese car companies will defeat all competitors.
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