China’s automotive industry remains in a complex environment characterised by market adjustment, industrial transformation and intensified competition, states SAIC Motor in its recent annual report.
The Chinese automaker is better known in India through its MG Motor brand and successful products like Hector and Windsor. The JSW Group acquired a 35 per cent from SAIC in 2023 and the company has since been rechristened JSW MG MotorIndia
According to the annual report, despite “excessive” competition in China’s domestic market, overall capacity remains substantial. And even if various risks and challenges persist worldwide, the trend of Chinese automakers accelerating global expansion remains unchanged.
“In the future, they are poised to deeply participate in, and eventually lead, global competition in the automotive industry,” says SAIC. When it comes to growth opportunities overseas, economic development and vehicle penetration levels vary across regions.
Emerging markets remain attractive
Initial estimates suggest that the addressable overseas market size for Chinese automakers is approximately 40 million vehicles, with particularly strong growth potential in emerging markets.
As electrification in these countries lags behind China, SAIC is of the view that Chinese automakers hold a distinct cost-competitiveness advantage and their combined exports + overseas production will comfortably exceed 10 million vehicles by 2030.
SAIC has noted that against a backdrop of global trade protectionism and geopolitical tensions, the US, Europe, and other countries have imposed restrictions on exports of Chinese automakers by way of additional tariffs and stricter carbon footprint accounting.
Global automotive giants are also rapidly enhancing their new energy vehicle portfolios for key markets. As Chinese brands increasingly expand overseas, international competition is effectively “domesticating” and the key to winning in overseas markets will shift from product level to systemic competition.
New energy vehicles to the fore
New energy vehicles are expected to maintain their growth momentum and SAIC believes that by 2030, their sales will exceed 20 million units. As supply of intelligent electric products continues to diversify and the concept of “tech equity” becomes widespread, growth patterns in the market will become more segmented. New energy vehicles have also become the dominant force in China’s automotive market and their exports have touched over seven million vehicles for the first time. However, SAIC has pointed out that with intensified domestic market competition coupled with rising international trade barriers, the profitability of China’s automotive industry continues to face downward pressure.
Only products offering updated technology and higher specifications at comparable price points will win consumer favourSAIC Motor, in its annual report
It is projected that over the next five years, the country’s automotive arena will see rising volumes and a slowing growth rate. As SAIC points out, by the end of 2025, China’s per‐thousand population vehicle ownership was around 260 vehicles, leaving “considerable room” for growth.
While the marginal effects of domestic auto consumption stimulus policies are expected to “gradually diminish”, the demands from “non-first-time buyers” in Tier 1/2 are likely to remain robust.
Small markets in China set to boom
Moreover, with continued “rural revitalisation and urbanisation” coupled with improving infrastructure, vehicle ownership in these smaller markets is set to accelerate. By the end of the 15th five-year plan (2026-30), domestic vehicle sales volume could reach 30 million units.
As stated in the annual report, only products offering updated technology and higher specifications at comparable price points will win consumer favour.
Over the next five years, SAIC will adhere to a user-centric business philosophy while continuously advancing innovation and transformation. It will focus on improving operational performance, strengthening core competitiveness, faster responsiveness and greater driving force.
This will lead to a “new SAIC” that appeals to the younger generation as a company distinguished by product appeal and technological strength.
The company aims to drive its premium brands into the top tier of intelligent electric vehicles and expand the domestic market foundation of its self-owned brands. It will also strengthen coordinated development of overseas brands and establish MG as a globally influential and competitive mainstream brand.
Becoming a global enterprise
The goal is to advance the transformation from a Chinese to global enterprise. A worldwide technological innovation network centered on Chinese technology is the top focus. SAIC aims to develop competitive technological strengths in areas such as all-solid batteries, hybrid powertrain technology, critical raw material system, intelligent chassis and hydrogen fuel cells.
Projections by the China Association of Automobile Manufacturers indicate that sales volumes of the domestic automotive industry are expected to reach approximately 34.75 million vehicles in 2026, a year-on-year growth of one per cent.
While continuing to expand the domestic market foundation, SAIC will develop overseas “growth poles” to seize structural market opportunities. It will strengthen and expand new quality productive forces while targeting annual sales of five million vehicles.
The company will also strengthen synergies in the components segment to accelerate mass production and application of new technologies such as solid battery, intelligent chassis, and intelligent cabin.
MG brand is designed by the British at the UK Design Centre, engineered by the Chinese in their global design/engineering centres and produced in India by IndiansSenior official at MG Motor India
SAIC will explore an integrated collaborative development model covering styling design, engineering development and manufacturing delivery to reduce overall costs and boost development efficiency.
For overseas operations, the company will explore new marketing models for the sales and service business, thereby accelerating the shift from scale expansion to efficiency improvement. For the mobility service business, it will expedite the scaled deployment of Robotaxi projects.
Coping with volatility across the world
Despite challenges such as “heightened international trade barriers”, the company has expanded its overseas presence by introducing multiple hybrid electric vehicle models. The MG brand achieved sales volume of over 300,000 vehicles in the European market, establishing itself as the best-selling Chinese brand.
MG has also brand ranked among the top ten in passenger vehicle sales in 18 countries across regions including Australia-New Zealand, the Middle East, Latin America, and Southeast Asia. The SAIC-GM-Wuling combine deepened its integrated strategy in Indonesia, Malaysia, and Thailand, increasing the share of new energy vehicle production and sales at its Indonesian base to 80 per cent.
SAIC’s light commercial vehicles and pickup trucks achieved robust growth in key markets such as Europe, Australia and Latin America. The company has “actively advanced” localised production by establishing contract factories and CKD operations overseas.
Through continuous improvement of the layout of overseas vehicle manufacturing bases, SAIC has established over 3,000 overseas marketing and service outlets, providing high-quality, diverse and sustainable products and services to consumers in more than 170 countries.
Rewinding to the India story
SAIC had first decided to enter the Indian market during the time of the Lehman crisis in 2008 and the global slowdown that followed. The General Motors top brass at that point in time realised that they were up against a huge challenge and turned to their trusted Chinese ally for help.
GM and SAIC created a 50:50 joint venture for India as part of the revival strategy which would see jointly developed products on a common platform. Products from the SAIC-GM-Wuling stable in China comprising a mix of passenger cars and pickups were identified for the exercise.
We want to be one of the first movers in EVs and a leading player in this space, but time will tell if we manage to pull it offSenior management member at SAIC Motor
However, customers in India did not quite take a fancy to cars like the Chevrolet Enjoy, a derivative of a Wuling product even while SAIC was carefully studying the market and consumer behavioural patterns.
The Chinese auto brand had now done its homework for India carefully and the next opportunity for a market entry happened when GM decided to exit the country with the closure of its Halol plant in Gujarat.
MG as the new face
SAIC stepped in as the new owner in 2017 and went into overdrive readying the facility. It also dropped the Chinese link completely with MG Motor now becoming its face in India keeping in line with its goal brand strategy.
“MG brand is designed by the British at the UK Design Centre, engineered by the Chinese in their global design/engineering centres and produced in India by Indians,” a top official had told this writer. The debut SUV, Hector, was loaded with features and clearly raised the bar in a space where the Korean duo of Hyundai and Kia were the big rivals.
Dealers were told to focus on customer service while being assured profitability The eventual objective was to have a sales and service team that would be among the best in the country. “Our endeavour was to surprise the customer in a positive way,” an MG Motor India executive had said.
The Jindals are now keen on taking the JSW MG Motor story to the next level where electric will be the biggest growth lever in the coming years. A senior member of the SAIC management team had told the writer in an earlier interview, “We want to be one of the first movers in EVs and a leading player in this space but time will tell if we manage to pull it off. We are hopeful and optimistic and the key is to see if customers find our value proposition compelling.”
