China's automobile exports to the sea, transportation capacity and product competitiveness are equally important
Interface News Reporter|
In 2023, China's automobile exports increased year-on-year to 5.221 million vehicles, surpassing Japan to become the world's largest automobile exporter. At this year's Beijing Auto Show, overseas dealerships flocked in, and Chinese car brands also launched global models to accelerate their overseas expansion.
For car companies, overseas transportation capacity is as important as product competitiveness.But currently, the global automotive shipping market remains hot, and the rental prices of automotive shipping ships have doubled tenfold in four years. The world is generally facing the problem of insufficient transportation capacity, which is a practical test for Chinese automotive brands with rapidly growing export demand.
Jorge Mosov, Chairman and CEO of Mosov Group, stated in an interview with Interface News and other media that the logistics of car overseas transportation is a series of comprehensive plans that require a set of solutions to help vehicles complete sea transportation, unload at ports, and then go to their sales destinations.
Mosov Group is one of the largest logistics service providers in Europe, transporting over 3 million vehicles annually. Chinese automotive brands it collaborates with include MG, NIO, Great Wall, and BYD. In 2023, Mosov transported 11000 SAIC MG cars into the German market and plans to increase this number to 24000 by 2024.
SAIC Group, behind MG, is one of the representatives of Chinese automakers going global. In 2023, overseas sales reached 1.208 million vehicles, with MG's global sales exceeding 840000 vehicles. SAIC Motor is still the earliest domestic automobile manufacturer to start its own fleet going overseas, and its subsidiary Anji Logistics has built the largest self operated fleet of automobile enterprises in China.
At present, in addition to SAIC, BYD's car transport ships have also been put into use, and Chery and GAC have also begun to layout in this area, hoping to ensure the stability and economy of export transportation through this method.
The key advantage of Chinese automotive products going abroad lies in their cost-effectiveness. If the shipping cost is too high, it will affect their terminal selling price, thereby weakening their competitiveness in the local market.
Jorge Mosov believes that Chinese automobile manufacturers can reasonably estimate and adjust demand by cooperating with local shipping companies to layout sea freight exports, without being affected by external factors. This can ensure the timely delivery of their products and the stability of their business.
Logistics groups with heavy assets may have more advantages in local resource integration and operation.How to ensure that vehicles can be smoothly unloaded and transported to their destination instead of being left at the port after arriving at the port depends on the cooperation between logistics companies and port operating agencies, as well as the sufficient allocation of self owned resources such as trucks, port resources, and car yards.
Taking Mosov Group as an example, it has large car yards in four major ports in Germany, with transportation vehicles including over 1000 trucks and 2 roll on/roll off ships, of which 80% are self operated. The heavy asset investment eliminates the need to rent assets from other companies, and it has certain advantages in cost control and operational efficiency.
Sea transportation is the main way of exporting new energy vehicles, and the safety issues of new energy vehicles during transportation have also attracted widespread attention in the past two years.
The power source of new energy vehicles is lithium batteries, which may self ignite or even explode in extreme environments and improper operation. This also makes the sea transportation requirements for electric vehicles extremely strict, and automotive logistics companies need to have professional experience.
"Generally speaking, during transportation, a software controlled system is needed to monitor the battery's status at any time to ensure safe transportation. In the event of an accident, there will be emergency plans to handle it, such as using special blankets to extinguish the fire."
According to Jorge Mosov, all process information of the vehicle from the loading site to the unloading site is recorded in the database and is monitored throughout the entire transportation cycle.
The European market has always been the region with the highest regulatory and standardization requirements for automotive products, and the traditional automotive industry has a strong foundation. In the past, Chinese automotive brands chose more regions in Asia, Africa, and Latin America for export and factory construction, making it difficult to enter the European region. However, now Chinese automotive brands see Europe as a new stop in their globalization process.
Chery and BYD are building factories in Europe to localize production, while SAIC is currently selecting a site. Great Wall plans to cover most of the European market by 2025. Jorge Mosov believes that due to the different stages of development and positions of different car brands in overseas markets, Chinese car brands entering the European market will initially face a relatively difficult market environment.
"MG is in a stage of rapid development and will not have too much inventory accumulation, but newly entered companies need to price their products reasonably and build a complete sales network and after-sales service system. Currently, electric vehicle pricing is still generally high."
He said that local logistics service providers in Europe can help new car brands open up local markets through resource networks, understanding of regulations, and partnerships with local institutions.
