Major Car Makers Cut Down Manufacturing Output in China

Published By : 16 Sep 2015 | Published By : QYRESEARCH

With sharp slowdown in China, the world’s biggest vehicle market, major car makers are cutting down on manufacturing output and slashing wages and other costs. Though the German automobile manufacturers have enjoyed a strong presence in China, they are expected to be the hardest hit amidst the slowdown. According to Stefan Bratzel, the director of the Centre of Automotive Management, the peak years in the Chinese automobile for global auto manufacturers are over. Auto experts are pointing out that the over dependence on Chinese market has negatively affected the global car manufacturers. They are further stating that manufacturers of cheaper and more affordable cars will pose stiff challenge to these global auto brands.

The premium car sector in China has been dominated by BMW, Audi, and Mercedes-Benz. All the premium auto brands are estimated to witness stagnant sales in 2015 with a drop of 4-5% next year. According to the reports, Volkswagen’s joint venture in China FAW-VW has cancelled staff bonuses and is cutting down shifts at its manufacturing facilities in Jilin province. The car manufacturer’s Audi brand has stated that the output has been cut down at its plants in China owing to lower demand for some of its models. 

At Frankfurt’s auto show, the industry leaders are putting up a brave face and are stating that they are quite positive about the automotive market in China. They have further mentioned that the short-term declines in China could be offset by the recovery in Europe. Industry analysts are stating that stumbling stock market coupled with slowing economy in China has put additional pressure on the automotive market. 

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