Introduction

From chaos to self-rescue.

At the dawn of the year, a maxim began to echo through the automotive sphere: China's auto market boasts three impregnable fortresses—BYD's manufacturing prowess, Huawei's intelligence prowess, and Xiaomi's marketing prowess. It is evident that the Chinese auto market in 2024 is once again in the throes of an unprecedented transformation, driven by a myriad of interwoven factors.

From price wars to groundbreaking autonomous driving innovations, from the pressing need for cost reduction and efficiency enhancement to the paradox of rising revenues without corresponding profits, from ambitious automotive export goals to the exploration of new reverse joint venture models, coupled with trade-in policy assistance, accelerated industry shuffling, the looming threat of tariff measures, and the formidable entry of tech giants like Xiaomi and Huawei, as well as the burgeoning trend of executive livestreaming for marketing, each of these keywords serves as a footnote to this transformation.

These keywords not only delineate the dynamic shifts in the market but also reflect the industry's deeply ingrained development trends and future trajectories, collectively weaving a complex and ever-evolving tapestry of the automotive landscape. Amidst this transformation, China's automotive industry faces unprecedented challenges yet nurtures opportunities for breakthroughs and innovations.

A clear theme resonates throughout the year like a main melody—in China's auto market, who will emerge as the savior? In this rapidly evolving market environment, both traditional fuel vehicle manufacturers with deep-rooted histories and emerging new energy vehicle makers are acutely aware that this is an era brimming with challenges and boundless opportunities.

Against this backdrop, self-rescue stands as the only viable path to ensure survival and even thrive in this tumultuous business landscape.

This is a war without guns, with every participant in the automotive market struggling for their future. They deeply comprehend that relying on external forces is akin to seeking fish in a tree; only by leaning on their own strength and wisdom can they remain unassailable in the fierce market competition.

This self-rescue initiative is not merely a test of their prowess but also a profound reshaping of the Chinese auto market landscape. It propels the entire industry towards more innovative and efficient development, infusing new vitality and hope into the future of China's automotive sector. In this journey of self-rescue, every automaker that perseveres will emerge as a leader in the new era of China's auto market.

The brutal reality of the market

Looking back over the past few years, China's auto market has been akin to an epic saga of ups and downs, experiencing a golden age of rapid growth, followed by a period of steady development and deep cultivation, and now this seismic and profound transformation. The rise of new energy vehicles, like an unstoppable flood, has unleashed an unprecedented and fierce impact on the traditional fuel vehicle market.

Data underscores strength. In 2024, sales of Chinese brand passenger vehicles soared, capturing a market share of up to 65.1%. This achievement is inseparable from the collective efforts of numerous Chinese automotive brands.

For instance, BYD, with its deep roots in the new energy vehicle domain, continues to unveil innovative models and has garnered widespread market recognition. New energy vehicle upstarts like Li Auto and NIO have also emerged, while Huawei and Xiaomi have successfully carved out new market niches with intelligence and electrification as their breakthrough points.

In this war without guns, Huawei's HarmonyOS Intelligent Drive and Xiaomi's automobiles have risen rapidly. Huawei's HarmonyOS Intelligent Drive shines brightly in the realm of intelligent connected vehicles, leveraging its robust technical prowess and deep industry accumulation. Xiaomi's automobiles, on the other hand, have endeared themselves to many consumers with their unique innovative concepts and affordable product positioning.

The auto market's elimination race has intensified, and market competition has become fiercer. In contrast, new energy vehicle brands such as HiPhi and JOYWAY have fallen by the wayside in this race. They either failed to withstand the brutal market baptism due to broken capital chains or insufficient product competitiveness.

Conversely, mainstream joint venture brands also appear to be struggling, with market sales declining by 16.2% year-on-year and market share shrinking to 27.6%. This decline not only reflects the lag of joint venture brands in the new energy vehicle sector but also highlights the severe challenges they face in the Chinese market.

Amidst life and death, rise and fall, this is not only a vivid microcosm of the rapid ascension of Chinese automotive brands through the new energy vehicle market but also a direct portrayal of the difficulties faced by joint venture brands in China. In the torrent of this transformation, no one can remain unscathed. Once-glorious joint venture brands are now under unprecedented pressure, prompting operations such as Volkswagen's investment in XPeng and other reverse joint ventures to catch up.

Meanwhile, foreign automakers constrained by corporate planning have also embarked on a path with Chinese characteristics: Dongfeng Honda Lingxi L, Changan Mazda EZ-6, Dongfeng Nissan N7... These joint venture brands have raised the banner of localization and launched adaptive new energy products, attempting to reassert themselves in the Chinese market.

Automakers' proactive moves

Faced with market challenges, Chinese automakers are the least likely to opt for inaction. They have also proactively launched self-rescue operations, penning magnificent chapters of transformation and innovation.

On one hand, traditional fuel vehicle manufacturers are acutely aware of the urgency of transformation. They have accelerated their progress towards electrification and intelligence, unveiling a series of new energy vehicle models in an attempt to secure a slice of the blue ocean market of new energy. Traditional giants such as Geely, Chery, and Changan have increased their investment in new energy research and development, introducing a slew of competitive electric vehicle models.

Geely Galaxy, Chery Fengyun, Changan Qiyuan, among others, with firm determination and decisive action, demonstrate the transformation resolve and strength of traditional automakers. These models have not only made significant strides in range and intelligent driving but also met consumers' diverse needs in terms of exterior design and interior configuration.

On the other hand, new energy vehicle manufacturers have leveraged their first-mover advantages in technology and the market to continuously consolidate and expand their market share. Taking BYD as an example, as the frontrunner in the new energy vehicle market, it has successfully claimed a leading position with its preeminent advantages in battery and motor technology, as well as the continuous introduction of innovative models.

Data reveals that BYD led the sales charts in 2024, with a market share of approximately 15.5%, making it a benchmark in China's new energy vehicle market.

These automakers' self-rescue initiatives have not only won them the market but also injected robust momentum and provided solid support for the transformation and upgrading of the entire Chinese automotive industry. They have proven with practical actions that only through continuous innovation and progress can one remain invincible in the fierce market competition.

Dual drive of policy and market

While automakers are rescuing themselves, the government has also actively intervened, issuing a series of policies and measures to provide a solid and powerful guarantee for the stable development of the auto market. From incentive policies such as trade-ins, scrapping, and renewal to preferential policies for the purchase of new energy vehicles, including purchase subsidies and exemption from vehicle purchase taxes, these policies have effectively invigorated the automotive consumer market and injected strong momentum into the popularization and development of new energy vehicles.

The government's "visible hand" and the market's "invisible hand" work in tandem to jointly propel the transformation and upgrading of China's auto market.

Driven by these policies, China's new energy vehicle market has flourished. Data indicates that in 2024, the cumulative retail sales of new energy passenger vehicles reached 10.975 million, marking a year-on-year increase of 42%. The sales of new energy vehicles accounted for more than 50% of total new vehicle sales for multiple consecutive months. This achievement is not only a fitting response to policy support but also the inevitable outcome of market promotion.

However, policy support serves merely as a temporary beacon illuminating the path forward for automakers; the true voyage still needs to be completed by the automakers themselves. Market competition, on the other hand, is an eternal ocean, with turbulent waves and hidden currents. Faced with increasingly fierce market competition, automakers must continually enhance their competitiveness to remain invincible in the market.

Both traditional fuel vehicle manufacturers and new energy vehicle makers need to increase research and development investment, consistently introduce new products, and improve product quality and technological levels. They must stay abreast of market trends, cater to consumers' increasingly diverse needs, and win market recognition and trust with innovative products and services.

Only in this way can they distinguish themselves in the fierce market competition and secure opportunities for future survival and development. In this journey of self-rescue and salvation, every automaker is fighting for its future, and only those who dare to rescue themselves and innovate can ultimately reach the mountain peak and admire the magnificent scenery after the ever-changing dynamics of the auto market.

Who will answer in the new era?

“No one helps me soar high, I trek through snow to the mountain peak.” In the volatile auto market, every participant is seeking the "savior" who can guide them out of their predicament and towards glory. From joint ventures to dealers, from intelligent technology to policy drives, from overseas markets to the rise of new forces, every entity is striving to become the savior of this era.

Who is the savior? There is no definitive answer. The savior in the auto market is not a singular individual or force but is composed of multiple factors such as intelligent technology, enterprises' own responses and adjustments, policy drives, overseas markets, and new force enterprises.

Intelligent technology provides innovation momentum and possibilities for the auto market; enterprises' own responses and adjustments enable traditional forces such as joint ventures and dealers to rescue themselves and transform; policy drives offer strong guarantees and support for the auto market; overseas markets present new outlets and development spaces for Chinese automakers; the rise of new force enterprises injects new vitality and competitiveness into the auto market.

In the future, as the market continues to evolve and technology continues to innovate, more opportunities will emerge. In this process, every participant has the potential to become the "savior" leading the trend of the times. They interact and influence each other, jointly driving the progress and development of the auto market.

As such, China's auto market will continue to advance amidst transformation, and actions of self-rescue and salvation will become an inexhaustible driving force for the development of the auto market. In this journey of self-rescue and salvation, every participant is fighting for its future. They are fearless of difficulties, forge ahead courageously, and are determined to establish a foothold in the fierce market competition.

The outcome of this battle will not only determine the survival of automakers but also profoundly impact the future direction of China's auto market. In this war without guns, only those automakers who dare to rescue themselves and bravely save others can ultimately reach the mountain peak and admire the magnificent scenery after the ever-changing dynamics of the auto market.