Welcome back to the latest episode of The Future of Automotive on CBT News, where we put recent automotive and mobility news into the context of the broader themes impacting the industry.
I’m Steve Greenfield from Automotive Ventures, and I’m glad that you could join us.
Well, I just got back from a trip to Kazakhstan this week.
Kazakhstan is really a fascinating country. Bordering Russia to the north and west and China to the east, Kazakhstan is the world’s ninth-largest country by land area and the largest landlocked country. And it has a population of 20 million people.
Kazakhstan declared independence on December 16th, 1991, becoming the last Soviet republic to declare independence. Ten days later, the Soviet Union itself ceased to exist.
Maybe most relevant for our audience here on this segment, the country has a new car market of 200,000 units sold per year and a used car market of 1,000,000 vehicles sold per year.
What I witnessed over there is a great case study of the effect of the Chinese automakers are having in a market where there aren’t any domestic automakers to protect with tariffs.
Driving around the city of Alamty for a few days, Chinese brands everywhere on the street. I literally didn’t recognize many of the brands I was seeing.
Just three years ago Chinese market share for new cars was 0%.
This year 2024, Chinese market share for new cars is 30%. While next year it’s expected to be 50%.
If you draw out that trend trendline, within two to three years the Chinese we’ll make up the vast majority of all vehicle sales in the country.
Speaking with industry experts over there they believe the Chinese will largely take over mainstream brands. But they didn’t seem as concerned with the strong brands that already have a great presence. Brands like BMW, Mercedes, Audi, Jaguar, Land Rover.
From my perspective, seeing the quality and the compelling price point of the vehicles that Chinese are manufacturing and exporting into the country of Kazakhstan, I think even these historical premium brands are going to be challenged to maintain market share versus new Chinese offerings.
To a lesser extent, we saw this play out in the U.S. with the entrance of Honda and Toyota in the 50’s and 60’s years. Then with the Koreans in the 80s.
The challenge now is the overcapacity and aggressiveness of the Chinese.
China will sell over 30 million new vehicles this year, about double that of the US market.
There are over 200 automakers in China, and are experiencing severe overcapacity and thus price discounting. At this point, it’s more profitable for a Chinese OEM to export their vehicles than sell domestically.
Michael Dunne wrote an article just last week providing a stark juxtaposition of Chinese vs. American manufacturing philosophies.
Dunne notes that Chinese automakers are on a global offensive, exporting cars and trucks – to more than 100 markets worldwide. China will ship 6 million vehicles in 2024, cementing its position at the world’s No. 1 exporter.
For Countries like the U.S., Canada and Western Europe, that are in the process of erecting prohibitive tariffs to protect their domestic automotive manufacturers, we’re just buying a short amount of time. More importantly is to use this precious time to figure out a way to compete.
As Michael Dunne so eloquently puts it in his article: “China is dominant in manufacturing EVs today; the question is whether the rest of the world will be content watching from the sidelines – or will dig deep right now to find the will – and the way – to compete.”
So, with that, let’s transition to Our Companies to Watch.
Every week we highlight interesting companies in the automotive technology space to keep an eye on. If you read my weekly Intel Report, we showcase a company to watch, and take the opportunity here on this segment each week to share that company with you.
Today, our new company to watch is SALES ASSIST.
Gather information from customers securely and easily with SalesAssist, the Ultimate CRM Booster that automates and modernizes your sales process, right from your CRM.
Gathering information and documents from customers is often the most time consuming part of the the automotive retail business.
SalesAssist helps the sales team with smart suggestions based on real time signals, so they know who, when, how and what to focus on to complete more sales.
SalesAssist provides a number of different info-gathering widgetd in a single panel, right from your automotive CRM. All information and documents are then efficiently gathered and entered into your CRM in real time, with a full audit trail.
No matter what info you need to gather from customers, SalesAssist has an off-the-shelf widget to streamline your customer facing interactions, from e-Signatures to Document Collections, to e-Forms.
If you’d like to learn more about SalesAssist you can check them out at www.SalesAssist.io
So that’s it for this week’s Future of Automotive segment.
If you’re an AutoTech entrepreneur working on a solution that helps car dealerships, we want to hear from you. We are actively investing out of our DealerFund.
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Don’t forget to check out my book, The Future of Automotive Retail, which is available on Amazon.com. And keep an eye out for my new book, “The Future of Mobility”, which is almost done, and will be out soon.
Thanks (as always) for your ongoing support and for tuning into CBT News for this week’s Future of Automotive segment. We’ll see you next week!
