Auto sales in the U.S. appear to be trending up, however, in China they’re up and running with General Motors seeing the benefits, reporting a 12% jump in its third quarter — its first positive report in two years.
The company reported Monday that it delivered 771,400 vehicles in China – it’s biggest market – where it sells Buick, Cadillac and Chevrolet-branded vehicles. Buick’s sales rose 26% during the quarter and Cadillac enjoyed a 28%. Chevrolet was dark spot, sales falling 20% during the period.
GM said sales of luxury vehicles, sport-utility and multi-purpose vehicles were strong during the quarter, citing the Buick Envision and GL8 as well as Cadillac XT5 as examples. The company also produces vehicles in partnership with Chinese-based makers. The Wuling brand saw an increase of 26% while Baojun saw its sales fall 19 percent.
The company is also trying to meet China’s demand for new energy vehicles, or NEVs, launching 10 models. The Chinese government has been offering subsidies to get more buyers for the zero-emissions offerings since sales have started to pick up in earnest after the impact of the pandemic in China.
GM’s NEV line-up includes the Buick Velite 7 all-electric SUV, Velite 6 plug-in hybrid electric vehicle (PHEV) and Wuling Hong Guang Mini EV introduced in July. Its NEV sales more than doubled in the first nine months from a year earlier. In the next five years, more than 40% of GM’s new launches in China will be NEVs, in line with GM’s global move to create a zero-emissions future.
A big share of that is due the aforementioned Wuling Mini, which debuted this summer and starts at just 28,800 yuan, or about $4,200. Demand for the Mini has turned the market upside-down, last month knocking Tesla off its perch as the country’s best-selling battery-electric vehicle, or BEV.
The price tag is the main driver of its appeal as the former top-selling Model 3 is nearly 10x more expensive, starting at about $45,750 in China. Buyers of the Mini can enough options to push the price past the $6K mark. It travels about 125 miles on a single charge, which lags the Model 3 which can travel at least 250 miles.
However, part of the problem that China’s had with getting people to buy EVs is the price and not the range. Most Chinese drivers – much like their American counterparts – travel much less than that. In fact, they tend to drive even less than U.S. drivers on a daily basis.
The Wuling brand has traditionally targeted China’s most budget-limited buyers with products like the Dragon cabover microvan. For many customers, these serve as work vehicles by day and personal transport at night and during the weekend. The Mini, however, is being targeted at office workers who need an affordable runabout. The low price helps offset the fact that it doesn’t qualify for all of the government subsidies that its larger, further-driving competition does.
“We positioned this model as a ‘people’s commuting tool,’” Zhou Xing, the branding and marketing director for joint venture SGMW, told Reuters ahead of the Beijing Motor Show. “Customers can drive their cars to work every day.”