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Home / Business / China's declining auto sales may be obscuring a demand shift

China's declining auto sales may be obscuring a demand shift



Tastes can change quickly in China. Wen Shuang, a Chinese social media influencer in the auto industry since 2012, said SUVs were in favor of the turn of the century, but now there's more interest in having multiple cars of different kinds. Who has 750,000 followers on Weibo, China's version of Twitter, and says she was born in 1990.

So she noted in a Mandarin-language interview this week's Shanghai Auto Show was not as hectic and exciting as it was last two years. However, they have become more and more attractive relative to foreign brands, except for those from Germany and Japan.

That's the strategy of many Chinese electric car start-ups, which are often selling directly to consumers or trying to create ecosystems that build customer loyalty.

Services can therefore be a weak point for traditional automakers in China. A customer's poor experience at a Mercedes-Benz dealership in the central city of Xi'an went viral on social media earlier this month, prompting parent company to suspend the franchise's operations this week, Reuters reported.

The technology-driven change in cars 'habits and a lower barrier to entry into electric cars is forcing the auto industry to revamp itself, Aiways' Fu said.

At least 1

00 new energy vehicle companies now exist in China, Fu estimated.

This is a completely new playing field, he said: "How many new ones can survive, that's how many new ones survive."

For a country of rapid change in consumer tastes and the adoption of technology, the auto industry may still be trying to catch up.


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