the internal crisis has spread to the most powerful german car companies
2024-09-23
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under the competition from chinese automakers, german automakers are also preparing to go through a difficult period after japanese, american and french automakers.
on september 20, mercedes-benz revised its 2024 performance guidance, predicting a full-year adjusted return on sales (ros) of 7.5%-8.5%, lower than the previous forecast of 10%-11%. mercedes-benz also expects earnings before interest and taxes (ebit) in 2024 to be lower than the previous year.
bmw adjusted its performance guidance for fiscal 2024 earlier on september 10, expecting its ebit margin to be between 6% and 7%, from 8% to 10% previously; and its return on capital employed (roce) to be between 11% and 13%, from 15% to 20% previously.
as bmw and mercedes-benz both lowered their annual performance expectations, the stock prices of these two german auto giants also experienced a flash crash. on september 20, the stock price of mercedes-benz group in the german market fell by more than 8% during the day and closed down 6.81%, hitting a new low in market value this year, with a maximum retracement of more than 35.38% from the high point of the year. as early as september 10, bmw had already hit a new low in stock price this year. on that day, bmw plummeted by 11.15%, with a maximum retracement of more than 40% from the high point of the year.
volkswagen group, also a german automaker, is also not immune to the impact. recently, the world's second largest automaker is planning to close its emden plant in germany. although german economy minister robert habeck is trying to prevent this cost-cutting measure involving tens of thousands of workers from actually being implemented, as he said, "volkswagen still has to handle most of the work itself. this is the company's job."
volkswagen factory in emden, germany, september 20, 2024, local time.
with multiple pieces of information overlapping, it is no wonder that even after li bin’s firm denial, the rumors about nio negotiating to purchase audi’s belgian factory continued to spread widely.
data from the china passenger car association showed that in august, the domestic retail share of domestic domestic brands was 63.4%, an increase of 11.4 percentage points year-on-year; mainstream joint venture brands sold 480,000 vehicles, a year-on-year decrease of 27%; and the retail share of german brands was 16.6%, a year-on-year decrease of 3.5 percentage points.
when mainstream joint ventures no longer seem to be mainstream, even the luxury car market, which has long been dominated by german brands, is now shaken.
in the past, luxury car brands represented by bba have always been the strongest presence in the chinese auto market. even in the past 2023, bba's sales in china totaled more than 2.3 million vehicles, accounting for 75% of the chinese luxury car market share.
by 2024, the situation has reversed. in august this year, bmw, which did not engage in price wars, sold only 34,800 vehicles in china, a 42% drop compared with the same period last year. mercedes-benz and audi sold 49,000 and 47,900 vehicles respectively, much higher than bmw, but also down year-on-year.
on the other hand, the chinese luxury camp represented by new forces is eroding the market share of the traditional luxury camp represented by german cars. from january to august this year, the cumulative sales of seres new energy vehicles behind wenji reached 279,306 units, a year-on-year increase of 381.75%; the cumulative sales of ideal auto during the same period reached 288,103 units; and nio delivered a total of 128,100 new cars during the same period, a year-on-year increase of 35.77%.
public data shows that in 2023, the share of domestic brands in the luxury market hit a record high of 25.1%, and in the first half of 2024, this figure further increased to 33.1%. at present, in the luxury car market share, the gap between domestic brands and german brands has narrowed to 10 percentage points.
as german automakers have lowered their performance targets, closed factories, laid off employees and cut salaries due to poor expectations for the chinese market, "chinese automakers are light years ahead of us" has changed from a modest title of an article in the munich mercury last year to a current fact.
the paper reporter zhou chunlin
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