The sales volumes of Chinese manufacturers have not significantly affected premium brands in any region, although premium brand sales have constituted a substantial and expanding market in China.
The significant loss of demand and development potential in China will substantially affect premium brands both now and in the coming years. In a decade, Chinese brands may become well-established in Western markets.
I contend that Chinese companies will find it much simpler and therefore faster to capture market share from premium manufacturers than the Koreans and Japanese did before, due to the substantial influence of technology, perceived allure, and monthly expenses on contemporary automobile sales.
They are much simpler, faster, and more cost-effective to accomplish than developing brands, racing heritage, technical superiority, and customer service; hence, the Chinese brands will not need an extensive lead time to become competitive, particularly with junior executive models A/C/1/3A3/A4.
There has been a tendency for a half-life in the duration necessary to build brands. The Korean manufacturers accomplished what the Japanese manufacturers achieved in half the duration. The Chinese producers will do this in much less than half the time required by the Koreans.
Logically, the sales volumes of Korean manufacturers will be most susceptible to competition from Chinese manufacturers; nonetheless, it would be intriguing to see if their established strength and relatively early investments in electric vehicle and internal combustion engine capabilities will empower them to mount a formidable defence.
I believe that European brands linked to compact vehicles, such as Renault, Peugeot, and Fiat, are going to have significant challenges in competing effectively. They depend on selling substantial quantities of modestly sized vehicles with little profit margins, while bearing the expenses of their heritage.
This renders them very susceptible, since consumers are likely to change brands if the monthly expense for a comparable model from an other manufacturer is £20 lower. Currently, Chinese brands may significantly undercut that sum while still maintaining profitability.
Conceding a portion of earnings potential via attractive monthly promotions is a very cost-effective strategy for developing a competitive automotive brand. Let us ascertain if the EU adopts a more defensive strategy to safeguard its own manufacturers.