Gm also cuts and restructures in China: 'Competition too aggressive'

In the latest quarter ended 30 June, GM lost $104 million on its Chinese business, part of a total first-half loss of $210 million. "We want to remain competitive and that means we need to review the business with our partner to make sure we can return it to profitability and sustainable cash flow going forward," said cfo Paul Jacobson. "China remains a good asset for us."

GM is certainly not alone. Faced with declining sales in an increasingly competitive market, Honda and Nissan decided to reduce production in the first half of the year. Also convinced by the evidence that the Rising Sun's market share has shrunk from 21% in 2019 to 12% in the first half of 2024. Honda opted for the closure of two plants for cars with 'thermal' engines, cutting production by around 300,000 units to 1.2 million and opening two sites by 2024, again with Chinese partners Gac and Dongfeng, to produce electric cars and then return to 1.4 million units. And in late July came the news of a all-Japanese alliance between Mitsubishi, Nissan and Honda itself, to collaborate on electric vehicle components and artificial intelligence in software platforms. Costs always in the foreground.

Among the Westerners stands out Volkswagen, Europe's leading manufacturer, selling 3.2 million vehicles in China by 2023 (3.5 a year earlier). During the last Beijing Motor Show in April, VW relaunched its plans with an offensive that includes 44 new models of all brands by 2026, a new architecture in partnership with the Chinese Xpeng (estimated cost savings of 40%) and the launch of the new sub-brand ID.Unix, aimed at the young public. The Wolfsburg giant is chasing the growth of its market share for full electric cars in China. In the first half of the year, Vww recorded a significant increase in percentage terms (+45%, from 62,400 in 2024 to 90,600), which translates into an advance from 2.3% last year to 3% this year (three million Bevs sold in total, of which 726,000 by number one BYD, which recorded a 17% increase).

That the Chinese market is increasingly challenging is also testified to, among other things, by Bank of America analysts' recent recommendation to Ford and General Motors itself to 'leave China as soon as possible' because it is no longer profitable. Ford, however, after the flop of the electric Mustang (Mach-E), has decided not to turn off the investment spigot, but to focus more on exports, as Vice-President Lyle Watters explained during the Beijing Motor Show.