What are the dreams of China’s young graduates?

[Hamartia Antidote]

250,000RMB~300,000RMB is a big money for US family also .

I did not see many BMW on the road when I was in USA.

Yes $40,000-$50,000 USD is a lot. The average family can't afford to spend that on a car.

 

[Kyle Sun]

Yes $40,000-$50,000 USD is a lot. The average family can't afford to spend that on a car.

US citizen's salary is very high ,I mean white collar, compared to the basic consumption level.
Your food and GAS are so so so cheap!

 

[rcrmj]

I think, the reasonable threshold of salary per month for Chinese graduates would be at least 10000 yuan.

10000 per month is enough in most cities except tier 1.

you serious```10,000 for young grads!?!

you know in real working environment, experience and attitude is way more important than a flashy certificate``
no matter what background they are coming from, I give them 3000 RMB for new graduates, thats it, we would give them generous bonus if they had any spark in workplace``

 

[LeveragedBuyout]

I didn't mean to imply that college students buy BMW's right out of school.
I was wondering if the number of cars on the road is increasing...who are the buyers.



But the average age for almost EVERY car make in the US is over 49. So you can't really use that,
Buick Goes Against Trend and Attracts Younger Buyers | The IHS Automotive Blog

Using that you'd think not many young people have cars. Of course this is not true.

The people buying BMWs in China probably overlap significantly with the people gambling in Macao (cough).

 

[Edison Chen]

The people buying BMWs in China probably overlap significantly with the people gambling in Macao (cough).

Those who gambling in Macao might buy more luxury cars.

BMW sold 200,000 in China last year, it is projected to be grow by more than 20% this year. I guess many middle class buy it.

 

[Edison Chen]

While at first it might have sounded like a snipe at China by me it actually may have uncovered something that people (including myself) don't realize.

I think the payscale in China bumps up drastically with experience while the scale here goes up more gradual.

If it doesn't the gap between the "haves" and "have nots" in China must be extremely wide.

If the average car costs say 150000 yuan then who is buying all the cars? It must be people with several years of experience since it seems unaffordable to a college grad unless they double their pay quickly.

Edit:
Ok it looks like the top selling car is the Ford Focus at about 100000 yuan. That's more like it. That's less than a 10000 monthly salary.

In fact, the payscale in China goes up very slowly, since the inflation is rising quickly. Money is not the money as it used to be. These college graduates in China prefer home mortgage more than cars.

I don't know if the Focus is the top selling, maybe top 5, because it's more fuel efficient and cheap.

 

[Hamartia Antidote]

In fact, the payscale in China goes up very slowly, since the inflation is rising quickly. Money is not the money as it used to be. These college graduates in China prefer home mortgage more than cars.

I don't know if the Focus is the top selling, maybe top 5, because it's more fuel efficient and cheap.

Top 10 best-selling cars in Chinese mainland[1]- Chinadaily.com.cn

#1 Ford Focus (MSRP 100,000 yuan, MSRP $16,800 in US)
#2 Volkswagen Lavida (MSRP 107,000 yuan, not available in the US)
#3 Buick Excelle (MSRP 96,000 yuan, not available in the US)
#4 Chevrolet Sail (MSRP 58,000 yuan, not available in the US)
#5 Volkswagen Sagitar (MSRP 131,000 yuan, not available in the US)
#6 Volkswagen Jetta (MSRP 82,800 yuan, MSRP $15,695 in US)
#7 Nissan Sylphy (MSRP 100,000 yuan,not available in the US)
#8 Chevrolet Cruze (MSRP 119,000 yuan, MSRP $17,500 in US)
#9 Volkswagen Santana (MSRP 85,000 yuan,not available in the US)
#10 Volkswagen Bora (MSRP 108,000 yuan, not available in the US)

Wow you guys really like Volkswagens!

 

[terranMarine]

VW is good

 

[Edison Chen]

Top 10 best-selling cars in Chinese mainland[1]- Chinadaily.com.cn

#1 Ford Focus (MSRP 100,000 yuan, MSRP $16,800 in US)
#2 Volkswagen Lavida (MSRP 107,000 yuan, not available in the US)
#3 Buick Excelle (MSRP 96,000 yuan, not available in the US)
#4 Chevrolet Sail (MSRP 58,000 yuan, not available in the US)
#5 Volkswagen Sagitar (MSRP 131,000 yuan, not available in the US)
#6 Volkswagen Jetta (MSRP 82,800 yuan, MSRP $15,695 in US)
#7 Nissan Sylphy (MSRP 100,000 yuan,not available in the US)
#8 Chevrolet Cruze (MSRP 119,000 yuan, MSRP $17,500 in US)
#9 Volkswagen Santana (MSRP 85,000 yuan,not available in the US)
#10 Volkswagen Bora (MSRP 108,000 yuan, not available in the US)

Wow you guys really like Volkswagens!

Yes, even my own car is Volkswagen. VW is also most government official's car. Many people think it's more reliable than other cars.

But Focus didn't sell well in the US. And the Buick Lacross too. I didn't see many Americans drive them. I can count the number of these cars that I have seen with my fingers.

 

[Hamartia Antidote]

But Focus didn't sell well in the US. And the Buick Lacross too. I didn't see many Americans drive them. I can count the number of these cars that I have seen with my fingers.

I have seen Ford Focus' around (234,000 sold in US in 2013) but have never noticed the Lacross (probably because most Buicks look alike so I never really differentiated it from the other models). 48,000 sold 2013.

 

[LeveragedBuyout]

Top 10 best-selling cars in Chinese mainland[1]- Chinadaily.com.cn

#1 Ford Focus (MSRP 100,000 yuan, MSRP $16,800 in US)
#2 Volkswagen Lavida (MSRP 107,000 yuan, not available in the US)
#3 Buick Excelle (MSRP 96,000 yuan, not available in the US)
#4 Chevrolet Sail (MSRP 58,000 yuan, not available in the US)
#5 Volkswagen Sagitar (MSRP 131,000 yuan, not available in the US)
#6 Volkswagen Jetta (MSRP 82,800 yuan, MSRP $15,695 in US)
#7 Nissan Sylphy (MSRP 100,000 yuan,not available in the US)
#8 Chevrolet Cruze (MSRP 119,000 yuan, MSRP $17,500 in US)
#9 Volkswagen Santana (MSRP 85,000 yuan,not available in the US)
#10 Volkswagen Bora (MSRP 108,000 yuan, not available in the US)

Wow you guys really like Volkswagens!

Here's a good article explaining Volkswagen's market share. In short, it has the first mover advantage.

http://www.ft.com/intl/cms/s/0/05db03d8-85c5-11e2-bed4-00144feabdc0.html#axzz3AKsimnFp


CASE STUDIES
March 11, 2013 4:46 pm
Volkswagen builds its brand in China
By Morgen Witzel

The story. As early as the 1980s, stirrings of economic reform in China encouraged Volkswagen’s senior managers to identify the country as a future growth market for passenger cars. They decided to establish sales and production in the country as soon as possible in order to reap the benefits of being first.


The first challenge. The Chinese government insisted on foreign businesses forming joint ventures with domestic companies. But most Chinese automobile makers concentrated on vehicles for industrial use rather than cars. Also, design and technology were both basic.

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As for consumers, a tiny fraction of the population earned enough to buy a car. Keeping a vehicle running was also problematic: Shanghai, for example, had a population of 12m in 1985 but 70 petrol stations at most.

The market would have to develop substantially before western carmakers could operate there profitably.


The initial response. Most of Volkswagen’s competitors were content to export small volumes to China and wait to see what would happen. The German company opted instead to establish operations on the ground, with a view to building its brand slowly and also establishing key relationships, including at various levels of government. Volkswagen accepted that it would be years before it saw financial returns – if ever.

It established a joint venture, called Shanghai Volkswagen, with Shanghai Automotive Industry Corporation in 1985; and a second, with First Automotive Works, in Changchun that began production in 1991. The Chinese companies and Volkswagen held equal shares in both cases. Volkswagen shared its technology, and factories were built or retooled to make Volkswagen brands.

Good relationships with government were cultivated, partly because of the levels of state control over business but also because government bodies were important potential customers. These relationships bore fruit early on when Volkswagen won contracts to supply taxis to the municipalities of Shanghai, Beijing and other cities. Red Volkswagen Santana taxis became a common sight on Chinese streets.

The taxis put the Volkswagen brand in the public eye. As more people bought their first car, Volkswagens made in China were a natural choice for many.

By 1995, Volkswagen had at least 70 per cent of the Chinese domestic car market. It had achieved a powerful first-mover advantage, and for several years other carmakers, domestic or foreign, were in its shadow.


The second challenge and response. By the early 2000s, that first-mover advantage was diminishing. Aggressive marketing of low-cost brands by other foreign companies, such as General Motors, and improved quality on the part of local carmakers meant that by 2004 Volkswagen’s market share had fallen to 15 per cent.

Its response was to introduce new technologies at the two joint ventures to bring down unit costs of production, and to launch new low-cost models such as Skodas.

Chinese customers still had a favourable view of the brand, and once Volkswagen was again matching rivals on price – and outdoing many on quality – they flocked back.

By 2010, Volkswagen was once again the leading car company in China, with Skodas accounting for about 20 per cent of sales.

Volkswagen has achieved an almost “heritage” appeal, and the company is admired for its long commitment to China.


The lessons. First, strong brand image was important. And the early contracts that established the brand in the public’s imagination were won at least partly through having good relationships with government.

Second, first-mover advantage takes a long time to establish and can be eroded very quickly. Volkswagen might have not acted quickly enough to protect that advantage but in the long run, the brand and good customer relationships enabled it to recover its position.


The writer is a fellow of the Centre for Leadership Studies, University of Exeter Business School

 

[Hamartia Antidote]

Here's a good article explaining Volkswagen's market share. In short, it has the first mover advantage.l

Volkswagen has always been at the top when it comes to new markets and grabbing marketshare with great prices.
I remember being in Mexico in the early '90s and I bet 80% of the cars were Volkswagens.

 

[LeveragedBuyout]

Volkswagen has always been at the top when it comes to new markets and grabbing marketshare with great prices.
I remember being in Mexico in the early '90s and I bet 80% of the cars were Volkswagens.

Indeed, despite its dark past, it lives up to its name and original purpose. The people's car, so they go where the people are. Hey, that rhymes.

 

[Aepsilons]

The people buying BMWs in China probably overlap significantly with the people gambling in Macao (cough).

lol

 

[Genesis]

The people buying BMWs in China probably overlap significantly with the people gambling in Macao (cough).

At one point yes, but since Xi took over, eating out is not done, and even legit events like weddings are not participated by officials, and even if they do it's a simple affair.

Right now, one picture and they could be done. thousands are charged each year.

So if you drive around in a BMW, it may not be the world's greatest idea right now.

Change is not on the way, it's here. Also Chinese people really like Audi, it's cheaper and does the job of being German.