Looking ahead, the Chinese automotive market is increasingly dominated by international brands such as Volkswagen China, General Motors China, Ford China, and Toyota China. It's true that, in a globalized world, if you're looking for a car, there are plenty of foreign brands available. However, among these well-known foreign names, we also have our own Chinese-made vehicles. In the past, China was renowned worldwide for inventions like papermaking, ceramics, and embroidery. So why can't we now build our own strong automotive brand and share it with the world?
Among the few domestic automakers with independent intellectual property, the responsibility of shaping the international image of Chinese cars falls on companies like Chery, Hafei, and Geely. These national manufacturers face challenges from foreign capital and technical barriers, but their brand autonomy and independence give them a fighting chance. While there may not be grand celebrations or flashy events, the focus is more on showcasing new technologies in a straightforward manner.
Recently, at a media event for the Chery QQ-Ezdrive in Caobao Road, the technological innovation of this independent brand was clearly highlighted. Chery makes a strong statement: national brands are not synonymous with low-quality products, and affordability does not mean low-tech content.
In just three years, Chery rose to become a key player in the domestic auto industry, driven by rapid growth in China’s auto consumption and its focus on the micro-car segment. However, by 2004, the market slowdown and fierce competition forced Chery to confront the growing pains of high-speed development—technical limitations, cost pressures, management issues, and market erosion.
Despite these challenges, Chery continues to grow. This phase may represent one of the most promising times for the company. Recently, Chery faced some setbacks, such as the QQ-Ezdrive underperforming against a competitor priced at just one yuan, and a reduction in its nationwide distribution network from 18 offices to just 7 regional centers. These changes suggest a shift in strategy—from a production-focused model to a more marketing-driven approach.
"If you want to establish yourself in the domestic market and eventually go global, you must follow market laws and adapt to changing environments," says Chery. Failing to address past issues, quickly transforming into a modern automobile company, and actively expanding overseas could lead to the loss of its accumulated strengths. The phrase "water flows downhill, people walk uphill" captures Chery’s recent developments, offering hope to those who care about the growth of national car brands.
With international brands dominating the domestic market, Chery’s move into the European and American markets could be risky. Therefore, while stabilizing the domestic market, focusing on emerging markets in the Third World seems like a wise decision. Recently, Chery successfully launched its Fengyun and QQ series in Egypt, marking the beginning of its expansion into the Middle East. Plans include building assembly plants in Pakistan, Egypt, Venezuela, Syria, and even negotiating with several Eastern European countries.
Chery is also preparing to produce QQ mini cars in Malaysia with a local partner. If Japanese and South Korean automakers spent a decade building their presence in Europe, what about China? According to Chery, quality is the cornerstone of brand value. “We won’t rush into new markets unless our products are ready to avoid damaging our brand reputation.â€
During economic downturns, cost control becomes crucial, leading to layoffs. Chery is streamlining operations, reducing staff, and optimizing its structure to improve efficiency. As the car market continues to reshape, only a few companies like Shanghai GM and Guangzhou Honda are thriving. Analysts predict the market turbulence may last until the end of 2005, making talent acquisition more competitive than ever.
Chery understands that optimizing its talent structure and breaking geographical boundaries are essential steps toward becoming an elite-led company. In the near future, the company plans to expand its marketing efforts globally, setting up R&D branches in Beijing, Shanghai, and even in Europe and the U.S. to attract top talent.
East China Distribution remains a key area for Chery’s sales, and the company has invested heavily in bringing in experienced marketing professionals from Taiwan. Liu Mingfu, a senior executive, believes the era of advanced automotive services has arrived, and Chery is determined to secure a strong position in the Shanghai market.
Despite the overall market slump, Chery’s performance has been relatively stable, with Chery Lianhai achieving its annual target ahead of schedule. With nearly 9,000 employees, including over 1,000 researchers, Chery’s research institute in the northwest of the plant is working tirelessly to design the future of Chinese automobiles.
In 2005, Chery plans to launch 3 to 5 new models, including a crossover and the A21. This year’s sales stagnation makes next year critical. We wish Chery all the best on the long road ahead.
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