Part 8/9:
The automotive market in China is embroiled in a price war that has not spared Great Wall Motors. Despite a 15% increase in sales earlier in the year, net profits fell by the same percentage. Chairman Wei Jianjun indicated a need to adjust product structures to mitigate losses. Companies in this environment face declining profits per vehicle, with the average dropping from 20,000 yuan in previous years to just 11,000 yuan in 2023.
Wei noted that the repercussions of this price war may last six to seven years, leading to brand instability and a shakeout of weaker players in the industry. Reflecting on the current state, WEEI, an industry critic, emphasized the necessity for ethical practices in the face of growing competition and unethical behavior common in such cutthroat market dynamics.