French automakers find success in Chinese market

08:41, August 04, 2011      

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French automakers are witnessing initial success in tapping into the Chinese market after adjusting their branding strategies and improving their understanding of the market.

Chen Guozhang, CEO of Renault (Beijing), the Chinese unit of French automaker Renault S.A., said that the company's sales in the Chinese market started to take off after the company started providing more localized products and services.

Renault boost its sales of imported cars from 894 in 2008 to 14,750 in 2010, an increase that essentially prevented the company from giving up on the Chinese market entirely, Chen said.

The company's decision to implement a "casual and luxurious" product concept won the hearts of China's younger consumers, with proper after-sales service also contributing to the sales increase, Chen said.

In another successful case, Dongfeng Peugeot Citroen Automobile Co., Ltd., a joint venture between Peugeot Citroen and Chinese automaker Dongfeng Motor Co., Ltd., sold 193,900 vehicles in the first half of 2011, making for a year-on-year growth rate of more than 10 percent.

Established in 1992, Dongfeng Peugeot Citroen is now one of the largest automobile joint ventures in China.

For Dongfeng Peugeot Citroen, product localization has been the key to success, said Bi Gaocheng, general manager of the company.

The carmaker has introduced car models that are more suitable for Chinese consumers, he said. It also established Peugeot Citroen's first overseas research and development center in Shanghai in order to obtain local data for the development of its products, said Bi.

With an annual sales volume of over 750,000 automobiles, Dongfeng Peugeot Citroen is now expecting a market share of 5 percent in China, he said.

Renault also built an 8,000-square-meter auto parts storage center in Shanghai, which has helped the company cut costs and lower transit times, said Chen.

For Chinese automakers who are seeking overseas expansion, Chen said it will be important to focus on proper branding.

He suggested that these companies should find local partners and dealers while improving after-sale services and customization to reduce complaints from foreign buyers.

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