These past few days, the automotive industry has been buzzing with several big pieces of news! I never expected that the challenges from German and Japanese carmakers would come so quickly.

1. Nissan's sales in China fell to just 54,000 units in April, a drop of 16% year-over-year.

2. Honda's sales in China dropped to only 43,000 units in April, a staggering 40% decline. From January to April this year, Honda's sales in China have fallen by 28%.

3. Volkswagen's global deliveries increased by 1.4% in the first quarter, but surprisingly declined by 7.1% in the Chinese market.

4. BMW's sales in China fell by 17.2% year-over-year in the first quarter, while Mercedes-Benz's sales in the Chinese market decreased by 10%.

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Look at this; times really are changing. Whether it's German or Japanese brands, whether it's Honda, Nissan, Mercedes-Benz, or BMW, they're all on the decline now. It seems everyone can feel it—more than ten years ago, there were mostly joint venture cars on the streets, but although joint venture cars are still common now, domestic brands account for nearly half. If this trend continues, in ten years, there might be nothing but domestic cars on the streets.

Yesterday, I was discussing this topic with a friend in the industry, and he summarized two reasons why people aren't buying German and Japanese cars. First, there is a difference in product competitiveness. It's not that joint venture cars are bad—German chassis and Japanese engines are very powerful technologies—but the problem is, domestic consumers' needs for cars are no longer satisfied with just being able to drive or being durable. People also want cars to be more comfortable, luxurious, and smarter, becoming part of their quality of life.

The other reason is probably due to changes in mindset. In the past, many people thought foreign cars were better, believing that joint venture and imported cars were more prestigious. But now many people don't think that way anymore; their attitude toward foreign products has shifted from admiration to equality. For the same 400,000 yuan, some people choose Mercedes-Benz or BMW, while others choose Huawei's AITO or Li Auto. There's no issue of prestige; it's just that different families have different needs.

Not just when buying cars, we can see more young people choosing domestic products in various daily consumption as well. For example, when buying clothes, young people no longer only recognize Adidas or Nike. They've discovered that domestic brands like Anta and Xtep have designs and quality that aren't inferior, with higher cost-effectiveness. Recently, outdoor consumption has been very popular on Vipshop. Sales of sun protection clothing have grown by 72%, while sales of sport T-shirts and sport pants have also seen double-digit growth. Among them, the best-selling ones are mostly good domestic brands such as Anta, Jiaoxia, and Camel.

In short, the competitive pressure for German and Japanese brands in China is getting bigger and bigger. A B-class car used to sell for 300,000 yuan to consumers, but now it's discounted to half the price at 150,000 yuan. The era of buying cars based on logos is fading away. How innovative something is and how high its cost-performance ratio is are becoming new factors influencing purchasing decisions.

Original article: https://www.toutiao.com/article/1832007349153795/

Disclaimer: This article solely represents the author's personal views.