In 2024, automakers globally faced unprecedented challenges, but SAIC-GM stands out as one of the hardest hit.

SAIC-GM boasts an impressive portfolio of world-class brands: Chevrolet, Buick, and Cadillac. Nevertheless, their sales performance in China has been on a downward spiral.

According to SAIC Motor's sales data for January to December, SAIC-GM's total sales for the year amounted to 435,000 units, marking a steep year-on-year decline of 56.54%. Last year, it barely maintained sales of over a million units, but this year, the decline was even more pronounced.

Remember the glory days? At its peak, SAIC-GM's annual sales soared to 2 million units, but the tide has since turned.

Examining the long-term trend, SAIC-GM reached its zenith in 2017 and 2018 with annual sales hovering around 2 million units. Since then, sales have consistently declined. In 2023, sales dropped by 50% compared to the peak, and in 2024, they plummeted by another 56% compared to the previous year, indicating a significant and persistent downturn.

SAIC-GM's dissatisfaction and frustration with such sales performance are understandable, and the company has indeed taken action. However, it now appears that these actions may have been little more than a momentary burst of anger.

On January 13, Lu Xiao, General Manager of SAIC-GM, unveiled the company's plans for its new energy transition at the SAIC-GM New Year Communication Meeting. He announced that SAIC-GM will introduce 12 new energy models within the next two years. These announcements reflect SAIC-GM's efforts and reluctance to give up. After all, abandoning China, the world's largest automotive market, is not an easy decision for any automaker. Nevertheless, the future of SAIC-GM's self-transformation in the Chinese market remains uncertain.

As the saying goes, an elephant falls slowly but struggles to turn around.

Looking back at the reasons behind SAIC-GM's sales collapse in the Chinese market may seem like hindsight, but it provides valuable insights. The introduction of three-cylinder engines was the catalyst that ignited the fire.

In 2019, SAIC-GM aggressively promoted three-cylinder engines despite the previous failures of such engines in the market. The result was predictably disastrous. In 2019, SAIC-GM's cumulative sales fell to 1.4633 million units, a year-on-year decline of 25.72%. Buick and Chevrolet, which had the most aggressive three-cylinder engine strategies, saw year-on-year declines of 19% and 24.8%, respectively. This meant that the 3.6 billion yuan invested by SAIC-GM in building its plant went down the drain.

While the strategic misstep with three-cylinder engines was significant, SAIC-GM's sluggish transition to new energy vehicles further exacerbated the company's woes.

In 2017, SAIC-GM announced plans to launch more than 10 new energy models over the next five years. However, it wasn't until 2021 that SAIC-GM fully deployed the Aote Neng platform. The pure electric models Buick E4 and E5, launched in 2023, failed to perform well due to intense competition. Moreover, the overall joint venture automaker market is currently in decline, and most automakers are struggling. Under such circumstances, SAIC-GM is unlikely to escape unscathed.

Conclusion

One misstep can lead to the collapse of an entire empire. So, in times of crisis, does GM still have a chance to turn things around? The answer is yes, but the path ahead will be fraught with challenges. Historically, GM engaged in a price war with European traditional automakers for half a century before establishing its position as a giant in the automotive industry. However, the current reality is alarming: even SAIC-GM's price war tactics are no longer effective.