BEIJING, April 26 (Reuters) - Global automakers
including Volkswagen and Toyota ( TM ) came to this
year's Beijing auto show looking to catch up to surging China EV
makers that are dominating the world's largest auto market.
The show that started this week showcased a marked shift in
attitude among some foreign automakers, industry executives
said. After being impressed by the bold leaps made by BYD
and other Chinese automakers at last year's event in
Shanghai, foreign automakers are now avidly searching for
Chinese partners and announcing new tie-ups, the executives
said.
Among the most active were European and Japanese automakers,
with announcements coming from Toyota Motor ( TM ) that it would team
up with Chinese gaming and social media giant Tencent ( TCTZF )
on artificial intelligence and big data, and Volkswagen
promoting its partnership with Chinese EV startup XPeng ( XPEV )
.
An executive from Renault said on Friday it had
"pivotal conversations" with Chinese EV maker Li Auto ( LI )
and Xiaomi ( XIACF ), the smartphone maker that just introduced
its first car, to explore EV and smart-vehicle technologies.
Nissan ( NSANF ), meanwhile, announced a tie-up with Chinese tech
firm Baidu ( BIDU ) to carry out research on AI and "smart cars."
Nissan ( NSANF ) CEO Makoto Uchida visited several booths including that
of Chinese tech giant Huawei, which is becoming a major auto
supplier.
European automakers sent "much more senior management" to
visit the booth of LIDAR remote sensing technology supplier
Hesai Technology this year versus last year, said Bob in den
Bosch, senior vice president of global sales at the
Shanghai-headquartered firm.
"They're looking for a partner to close the gap," he said.
"They came here with a plan and a mission."
Foreign brands have dominated China's auto business since
the 1990s and have brought extensive know-how to the Asian
country. But last year, foreign brands' collective share of
China's passenger car market fell to 48%, down sharply from 57%
just two years earlier, according to data from the China
Association of Automobile Manufacturers.
GOING LOCAL
German automakers including Volkswagen and Mercedes,
in particular, emphasized their efforts to localize production
and invest more in local partnerships, with Volkswagen saying
repeatedly its goal was to remain the best-selling foreign
automaker in China into 2030.
Hildegard Mueller, president of Germany's powerful car lobby
VDA, told Reuters that the German automakers are, in addition,
exploring new marketing strategies to attract Chinese consumers.
This includes partnering with the country's army of car
influencers, who promote and discuss new vehicle models and
trends with their large followings on social media.
"It's huge (online) traffic and huge potential," she said.
The market share in China of Toyota ( TM ), the world's top-selling
automaker, declined last year, according to data from the China
Passenger Car Association (CPCA). Toyota's ( TM ) China joint ventures
with GAC and FAW held a combined 7.9% of the Chinese auto market
last year, compared with an 8.6% share in 2022, the CPCA said.
Toyota ( TM ) has said it will include technology from Tencent ( TCTZF ) in a
China-made passenger vehicle the Japanese automaker will put on
sale this year as part of a new tie-up.
On Thursday, Toyota ( TM ) took care to emphasize the new tie-up,
with its chief technology officer, Hiroki Nakajima, inviting a
senior Tencent ( TCTZF ) executive onstage to its auto show presentation.
"We want to, with Toyota ( TM ), build products and services that
are closer to consumers, to jointly build mobility solutions of
the future and we look forward to the fruits of our
cooperation," said Dowson Tong, CEO of Tencent Cloud and Smart
Industries Group.
PESSIMISM
Some foreign auto executives were more pessimistic about
their ability to fight back.
Katsuhide Moriyama, president of GAC Honda Automobile,
Honda's ( HMC ) joint venture with Guangzhou Automobile Group
, cited how China's leading EV makers have found ways
to slash vehicle development time.
"Manufacturers should shorten the lead time to compete with
those competitors," Moriyama said outside the automaker's booth
at the show. "But a two-year model cycle is too short for us."
The number of American car executives paled compared with
visitors from other foreign markets, noted Hesai's In den
Bosch.
The market share in China of major American brands including
Ford and General Motors ( GM ) has plummeted amid
declining gasoline-car sales and the shift from foreign to
Chinese brands.
Ford's chief financial officer, John Lawler, told reporters
in the United States on Wednesday that the automaker wants to
maintain its existing China presence but is not planning to
invest more.
"We're not putting capital into China," he said.