Chinese Market Q3 2023: Non-Chinese OEMs Strengthen R&D

Chinese major OEMs move to use AI and announce new brands

2023/11/10

Summary
Trends of Chinese OEMs (Q3 2023)
Trends of major non-Chinese manufacturers (Q3 2023)
Policies related to China's automotive industry (Q3 2023)
Major automakers' third-quarter sales volumes (ex-factory) in 2023

Summary

Toyota China's largest R&D facility, IEM by TOYOTA (Source: Toyota)

According to an announcement by the China Association of Automotive Manufacturers (CAAM) on October 11, 2023, in the first nine months (January-September) of 2023, sales volume (factory shipments) in China increased 8.2% year-over-year (y/y) to 21,069,000 units, of which passenger car sales grew 6.7% y/y to 18,130,000 units, and commercial vehicle sales increased by 18.3% y/y to 2,939,000 units. Sales of New Energy Vehicles (NEVs: battery electric vehicles, plug-in hybrids, and fuel cell vehicles) in the same period grew 37.5% y/y to 6,278,000 units, comprising 29.8% of the Chinese market. According to MarkLines data, the sales volumes of many foreign joint venture finished vehicle manufacturers fell by more than 10% compared to the same period last year. Groups relying on foreign brands were relatively heavily affected.

This report presents key trends in the Chinese market for Chinese and major foreign automakers in the third quarter (Q3) of 2023. Many Chinese automakers have announced new brands, with names such as BYD's Fang Cheng Bao, Geely's Jiyue, Dongfeng Motor's Dongfeng Nammi, and Changan Automobile's Changan Qiyuan, to name a few. In addition, several companies are focusing on applications in the fields of AI large-scale language models and smart cockpits. For example, GAC was the first to launch an AI large-scale language model platform and to put the smart voice interaction scene to practical use, while Chery and iFLYTEK have developed AI voice assistance using large-scale language models. Great Wall Motors plans to build a large-scale language model service platform and become a partner for Baidu Apollo's ERNIE large-scale language model smart cockpit.

Among major foreign automakers, VW, BMW, Toyota, and GM are focusing on strengthening local research and development. XPeng, FAW, and SAIC are partnering with VW and Audi to jointly develop new electric vehicles (EVs). BMW has opened a new R&D center in Shanghai, establishing its largest R&D structure outside Germany in China. Toyota is further strengthening local development of intelligent and electrification technologies. Toyota Motor Engineering & Manufacturing (China) Co., Ltd. changed its name to Intelligent ElectroMobility R&D Center by TOYOTA (China) Co., Ltd. (IEM by TOYOTA). GM has declared that it will form a team of local experts who will be responsible for technical development of vehicle software.

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