Market Development and Outlook Weiming Soh. Executive Director, Volkswagen AG Member of the Board, Volkswagen Group China

Transcription

1 Market Development and Outlook Weiming Soh Executive Director, Volkswagen AG Member of the Board, Volkswagen Group China

2 Automotive News China Conference Shanghai 2011 Current China Automotive Market Volkswagen Group China Performance Review Market & Volkswagen Group Outlook

4 After the world financial crisis, China s economic development is entering into a more mature, consistent and normalized stage Growth rate in % 30 GDP Growth in China 20 Forecast 10 0 year Source: Institute of Economics Chinese Academy of Social Sciences, State Information Center (SIC) 4

5 2010 GDP reached a 10.3% growth year on year, and the economy is now in a path of stable growth Q Cumulative Annual Growth 9.6% Cumulative Annual Growth 9.2% Cumulative Annual Growth 10.3% 10.6% 10.1% 9.0% 6.8% 6.1% 7.9% 8.9% 10.7% 11.9% 10.3% 9.6% 9.8% 9.7% Q1/08 Q2/08 Q3/08 Q4/08 Q1/09 Q2/09 Q3/09 Q4/09 Q1/10 Q2/10 Q3/10 Q4/10 Q1/11 Source: The National Bureau of Statistics China 5

6 After strong booming in past two years, passenger car market growth in China is excepted to stabilize in 2011 Total Passenger Car Market China (incl. HK) 000 Units +35% +54% 11,457 CAGR +19% 8,482 5,503 2,266 3,071 (Q1) E Source: CKD CPCA; FBU - Registration 6

7 The passenger car market is estimated to maintain a positive trend in 2011, with a stable quarterly growth rate China Total Market (incl. HK) CY2011 vs. CY2010 Growth Rate 2011 vs Full Year +10% Q1 +15% Q2 +15% Q3 +10% Q4-1% 1,300 1,200 1,100 1, ,255 1, Units CY 2010 Actual: million units CY2011 Forecast Most Likely Scenario: > 12 million units Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Source: CPCA; Volkswagen Group China 7

8 Consumer Confidence Index is recovering in Q Consumer Confidence Index Consumer Confidence Index on Auto Consumption Index 100 = April Historical Low Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Year 2008 Year 2009 Year 2010 Year 2011 Source: Xinhua Finance EziData Chinese Consumer Confidence Index (CCCI) 8

9 The average industrial stock level by end of March 2011 increased significantly to 1.9 Current stock level (in month) of major OEMs (>1.5) (1.2~1.5) (<1.2) Volkswagen Group Cherry TJ FAW Geely Industry Average BYD DF- Nissan Chevrolet Kia Hyundai GZ- Toyota GZ- Honda DF- Honda DF- PSA Skoda SVW VW Ford FAW- Buick Audi FAW-VW Toyota VW Source: CPCA, Volkswagen Group China 9

10 Major OEMs remain optimistic to market growth in 2011 with more new models to be introduced this year No. of new car C B Timetable of new car launches in A A0 A00 Remarks: Local Brands Models Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Source: IHS Global Insight; Volkswagen Group China 10

12 For Q1 2011, the performance of Greater China accounted for 28% of Volkswagen Group worldwide Passenger Car Market Worldwide Jan - Mar, 2011 Volkswagen Group Worldwide Jan - Mar, 2011 China 69% Market developed countries 20% 28% 4% Brazil 3% Russia 4% India China 8% Brazil 2% Russia 1% 60% India Market developed countries Source: Volkswagen Group China 12

13 Greater China contributed 35% of Volkswagen Brand worldwide in Q Passenger Car Market Worldwide Jan - Mar, 2011 Volkswagen Brand Worldwide Jan - Mar, 2011 China 20% 35% 4% Brazil 3% Russia 4% India China 69% Market developed countries 1% Russia 2% India 12% Brazil 50% Market developed countries Source: Volkswagen Group China 13

14 Volkswagen Group is performing better than the World Car Market World Car Market: +7.6% Volkswagen Group: +13.5% Growth rate in key regions (Jan-Mar 2011 vs. Jan-Mar 2010) Car Market North America Volkswagen Group +17.6% +17.9% Western Europe Car Market Volkswagen Group -2.6% +6.1% Central & Eastern Europe Car Market Volkswagen Group +40.5% +30.7% South America Car Market Volkswagen Group Car Market South Africa Volkswagen Group Asia Pacific incl. China Car Market Volkswagen Group +9.3% +2.9% +25.5% +40.4% +4.8% +22.1% Source: Volkswagen Group China 14

15 Volkswagen Group is aiming for a new height in China market as a strategic target in near future 000 Units Market Growth 1, ,024 1, (Q1) E Source: Volkswagen Group China 15

16 In Q1 2011, Volkswagen Group maintained its Number 1 position by market share in China Mainland Market Share Overview by Group Volkswagen Group YTD MS % YTD MS % Ranking Group 2010 Jan-Mar 11 1 Volkswagen Group 16.8% 17.9% 2 GM Group 9.4% 10.5% 3 Hyundai Group 8.8% 8.0% 4 Toyota Group 6.6% 6.0% 5 Nissan Group 5.8% 5.4% 6 Honda Group 5.7% 5.0% 7 BYD Group 4.2% 3.6% 8 Geely Group 2.9% 3.4% 9 Chery Group 4.5% 3.1% 10 PSA Group 3.3% 3.0% Others 32.0% 34.1% Source: CPCA excl. LCVs; Volkswagen Group China 16

17 Volkswagen brand strengthened the market leading position by market share in Q Market Share Overview by Brands Volkswagen Brand YTD MS % YTD MS % Ranking Brand 2010 Jan-Mar 11 1 Volkswagen 13.2% 14.0% 2 Toyota 6.6% 6.0% 3 Nissan 5.8% 5.4% 4 Buick 4.8% 5.3% 5 Hyundai 5.9% 5.2% 6 Chevrolet 4.7% 5.1% 7 Honda 5.7% 5.0% 8 BYD 4.2% 3.6% 9 Chery 4.0% 2.9% 10 Kia 2.8% 2.8% Others 42.3% 44.6% Source: CPCA excl. LCVs; Volkswagen Group China 17

18 In China, SVW delivered over 811,000 units for Volkswagen Brand cars in Sales 2010 Lavida sales volume > 240,000 units Tiguan, New Polo and New Touran successfully launched Lavida Santana/ Vista Passat Polo Tiguan Touran 2011 In Q1 2011, SVW delivered over 230,000 units for Volkswagen Brand Launch of Passat (New) in 2011, following with more new products Source: Volkswagen Group China 18

19 In China, FAW-VW delivered more than 658,000 units for Volkswagen Brand cars in Sales 2010 New Bora sales volume > 150,000 units Golf sales volume > 50,000 units Jetta New Bora Sagitar Magotan Golf A6 CC 2011 In Q1 2011, FAW-VW delivered over 180,000 Volkswagen Brand cars Launch of Magotan (New) in 2011, following with more new products Source: Volkswagen Group China 19

20 The latest models have dramatically improved Volkswagen brand image in the past few years Sales of Shanghai Volkswagen Sales of FAW-Volkswagen +Touran +Lavida + Passat LY + Tiguan + Passat + Sagitar +New Bora +Golf A6 +CC (New) + Magotan +Magotan (New) 55% 60% 72% 78% 56% 60% 67% 73% Santana Jetta Medium Term Medium Term Old models New models Source: Volkswagen Group China 20

21 With coming new products, Volkswagen Group will strengthen A NB segment dominance and lead in the B NB segment with over 25% share Volkswagen Group performance in A NB segment Volkswagen Group performance in B NB segment 26% 25% >25% 17% 22% >25% Medium Term Medium Term Volkswagen Brand Other Brands Source: CPCA; Volkswagen Group China 21

22 Volkswagen Brand will be leading the market in the B NB segment with over 20% share Volkswagen Brand continuously solidified its leading position in A NB segment Volkswagen Brand is striving for over 20% segment share in B NB segment 19% 19% >20% 16% >20% 15% Medium Term Medium Term Volkswagen Brand Other Brands Source: CPCA; Volkswagen Group China 22

23 Although with limited high-end models, Volkswagen import business in China is challenging ever ambitious targets Business Startup Infrastructure Setup Network, Training, Process, etc. Accelerate Growth Individual, Motorsports, Bluemotion Medium Term 16,000 (Q1 2011) Target Ranking in Volkswagen Worldwide Phaeton No ,162 40,325 Touareg No ,026 5,015 7,850 11,108 New Beetle No.22 Sales volume as today s: India Ukraine Hungary Czech Poland Turkey Russia Spain Scirocco No.2 2 Source: Volkswagen Group 23

24 Volkswagen Group is striving for leading position in the Hong Kong market Market Share Overview Volkswagen Group Hong Kong Volkswagen Group Ranking 1 Brand Volkswagen Group YTD MS % YTD MS % % Jan-Feb 11 23% 2 Toyota Group 24% 23% 3 BMW Group 17% 19% 4 Mercedes Benz 14% 17% 5 Nissan 6% 6% 6 Honda Group 9% 5% 7 Mazda 3% 3% 8 Volvo-Cars 1% 2% 9 Mitsubishi 1% 1% 10 Subaru 1% 1% Others 1% 1% Source: MTA; Volkswagen HongKong Not for release, publication or distribution in the United States, Australia, Canada or Japan 24

25 By February 2011, Volkswagen brand Hong Kong reached 13.4% market share, ranking 4 th in the market Volkswagen Brand Market Share in January -February 2011 Strategic Challenge for Volkswagen Brand Market Share YTD 2011 Jan - Feb 16.7% 15.7% 1 8.1% 14.4% 13.4% Volkswagen HK established % 5.6% 7.8% % 1 1.5% 3.4% 5.2% 4.5% 4.3% 5.5% Medium Term * Sales of Volkswagen Group Hong Kong include Porsche data in Source: MTA; Volkswagen HongKong 149.9% stake since 7 December

26 Audi brand maintained the 1 st place in China Premium Passenger Car market Market Leader in China Premium Passenger Car Market Rapid Growth of Audi Brand In Units In Units +43.4% 40,765 31, % 228,000 34,539 20,424 26,852 15, % +78% 81, , , ,000 9, % 7,448 `` 2011 Jan-Feb ` 2010 Jan-Feb Remarks: In Q1 2011, Audi delivered 63,432 vehicles Source: Manufacturers exchange data; Volkswagen Group China 26

27 Skoda Brand is growing fast with average annual growth rate of 87% in Skoda Brand Competitiveness Skoda Brand Growing Fast Superb/ Octavia/ Fabia 34,943 26,674 In Units +31% In Units +47.3% 180,515 Mondeo/ Focus NB/ New Fiesta HB 28,470 31,403-9% 122, / 408/307 NB/ 207 HB 13,650 7, % 59,284 Mazda 6/ Mazda 3 NB/ Mazda 2 HB 28,280 32, Jan-Feb -13% 2010 Jan-Feb 27, Remarks: In Q1 2011, Skoda delivered 54,400 vehicles Source: CPCA; Volkswagen Group China 27

28 SEAT will be introduced to China and delivery ENJOYNEERING to Chinese customers Ibiza CUPRA Dynamic Sporty Exciting Modern Tech Young Spirited Passionate Urban Progressive Design Driven Detail Individual Tempered Dealer Network Planning Leon CUPRA R Initial Stage Medium Term 28

29 The ambition of Bentley business in China is to become the No.1 worldwide Top 5 Country Sales in , Q Source: Volkswagen Group 29

30 Lamborghini achieved 23% market share* in mainland China in the highest market share in the world Top 3 Country Sales in Q *: Market share of ESS segment Source: Volkswagen Group China 30

31 Bugatti will drive the sales to a new era through newly developed direct sales channel ` ` ` Direct Sales Dealer Showroom One Face Aftersales ` ` ` AutoShow Bugatti Tours in China Media/VIP Event Source: Volkswagen Group China 31

32 Establishment of Group Import Company is under planning to maximize synergy among Group Brands Group Import Company Group Brands Brand Operations Pre-Sales Sales After Sales After Sales Support Market & Network Analysis Used Car & Fleet Sales Training Group Functions Back Office Finance IT HR Legal Vehicle logistics Source: Volkswagen Group China 32

34 Mega and midsized cities will be the engine of GDP growth Distribution by city size City Level (Population) cities cities % of GDP Mega (10M+) Big (5-10M) Mid-sized ( M) Small ( M) Big town (<0.5M) New cities Remarks: 8 mega cities in 2010 (Shanghai, Beijing, Chongqing, Shenzhen, Tianjin, Wuhan, Chengdu, Guangzhou) Source: McKinsey Insights China

35 China city classification Categories Classification Number of cities City name Carparc % (2009) Category A Mega 8 Beijing, Shanghai, Chongqing, Shenzhen, Tianjin, Wuhan, Chengdu, Guangzhou 25% Category B Big 10 Xi an, Shenyang, Nanjing, Hangzhou, Jinan, Changchun & etc. 11% Category C Mid-sized 114 Wenzhou, Wuxi, Changzhou, Xiamen, Qingdao, Zhuhai, Dalian & etc. 43% Category D Small 252 Langfang, Huzhou, Guilin, Liuzhou, Xi ning, Yinchuan, the out-of-the-way cities & etc. 21% Source: McKinsey Insights China, Carparc data from National Statistic Bureau

36 Total Passenger Car Market in China will develop further in the future Total Passenger Car Market Forecast China (incl. HK) 000 Units Average Annual Growth Rate >7% >8% 20,000 >9% 15,000 >12,000 11, E 2013E 2018E Source: Volkswagen Group China 36

37 In , A Segment will still dominate and SUV is the fastest growing segment Segment Trend Body Trend D Segment C Segment B Segment HB A Segment NB A0 Segment A00 Segment Q E E MPV SUV 0.6 Others Q E E Source: Volkswagen Group China 37

38 China A digital giant: accounting for worlds largest internet population with particularly active users and the biggest growth potential Internet Users & Penetration in 240 million / 77% 475 million / 58% 457 million / 34% Mobile Internet Users Europe 21% China 62% 63% of users interested in cars want an interaction with car companies online. People creating content US 21% China 40% 30% of Chinese access social media via their mobile phone Sources: Universal McCann (2010), Internetworldstats (2010), China Internet Network Information Center (2010), Ignite

39 Volkswagen Group China is on the track to contribute to worldwide Mach 18 Strategy Volkswagen Group World Wide Volkswagen Group China 10 Mio. 3.7 Mio. 4.0 Mio. 4.5 Mio. 5.2 Mio. Market Growth 0.9 Mio. 1.0 Mio. 1.4 Mio. 1.9 Mio Source: Volkswagen Group 39

40 Volkswagen Group China will double the number of dealerships to ensure penetration and competitiveness >53% >2,000 1, Medium Term Source: Volkswagen Group China 40

41 New Phaeton Lounge is to develop leading standards and retail environment 辉腾定制中心 Phaeton Lounge Target 3,300 Yearly Total 1,400 1, Medium Term Source: Volkswagen Group China 41

42 Volkswagen Group will retain and attract the best investors to further expand and optimize the network Volkswagen Group 1 WIN-WIN Partnership Dealer Groups Past OEM - Dealers Future Best Strategic Partners Individual Dealership Local Development Dealer Group Synergy National Expansion Source: Volkswagen Group China 149.9% stake since 7 December

43 The idea for the Volkswagen Academy Our Chinese customer expects a consistent Volkswagen brand experience across our networks in China. Volkswagen Academy. The Academy is the best platform to steer Volkswagen brand experience and the cutting-edge training. For the first time, it offers Volkswagen brand trainthe-trainer diploma program directly in China Source: Volkswagen Group China 43

44 Volkswagen Academy was having the Grand Opening on 31 st March, 2011 in Beijing Volkswagen Academy Grand Opening Ceremony Aftersales Workshop Academy Facility Source: Volkswagen Group China 44

45 Volkswagen Academy will provide qualified and professional trainers with Volkswagen certification for our retail network Group Retail Personnel Development (No. of retail staff) Volkswagen Group Trainer Development (No. of trainers) +100% +100% >150,000 >1,000 >70,000 > Medium Term 2010 Medium Term 45

46 Volkswagen Academy has been set up and running to improve the competence level in China 12 Curriculum modules 3 Competency levels Brand Sales Product Basic Level Advanced Level Expert Level Non-tech Technical Management 9 Target positions Test Drive Pedagogical Fin. & Ins. IT Used Car Fleet Trainer Sales Consultant Sales Manager Service Advisor Service Manager Parts Manager Master Technician/Technician Marketing Manager General Manager Source: Volkswagen Group China 46

47 The Academy will serve as the center of excellence to enable our people to achieve the new height Software Hardware Operation Excellence Train-the-Trainer Certification New curriculum development (Used car, fleet, F&I, etc) Customer Satisfaction Coaching Concept Management Excellence Dealer General Manager development program Volkswagen Way Leadership program Top-performer retention program Best Learning Platform China training curriculum R&D center Brand & innovation center Regional training centers National educational partnerships Best Quality No. 1 Customer Satisfaction No. 1 Top-of-mind Brand Image Top Performer Attraction/Retention Source: Volkswagen Group China 47

48 The People s Car Project will create innovative and interactive consumer on-line experiences for China Source: VC 48

49 Volkswagen Digital Offensive become China s most digitized auto brand by 2012 CHINA DIGITAL MARKETING CHINA S YOUTUBE Tudou CHINA S FACEBOOK Kaixin001 3D VW BRAND Brand World WORLD MOBILE People s INITIATIVE Car Project PEOPLE S CAR People s Car Project PROJECT LAUNCHED Oct LAUNCHED Apr LAUNCHED Jan LAUNCHED Apr LAUNCH May 2011 Idea: Create China s first dedicated online auto video channel and unite brand as well as user videos. Idea: Create highly engaged community of VW fans, become part of people s daily life online. Idea: Unite all dealer networks in a 3D showroom and offer maximum user experience. Idea: Lift brand experience and customer interaction with exciting mobile apps. Idea: Integrate consumers into innovation processes via a cutting edge online platform. Status: 7.6 mio video views, 640 user generated videos Status: 2.5 million fans (largest brand space) Goal: Create cutting edge 3D experience. Goal: Increase brand interaction and consideration Goal: Build the first car by the people for the people. Source: Volkswagen Group China 49

50 3D Volkswagen Brand World will consolidate all Volkswagen products with advanced digital format New Phaeton Variant Polo R-LINE Area Tiguan Passat New Touareg Scirocco CC Touran New Beetle Golf E-Mobility Area Magotan Golf GTI Source: VC 50

51 Volkswagen e- Mobility: Volkswagen as the Friend of National Museum of China (NMoC) and Be The First To Drive national road show Museum Hopping E- Fleet 7 Cities National Road Show Changchun Tianjin Chengdu Hangzhou Xiamen Guangzhou Hong Kong Source: Volkswagen Group China 51

52 Our Vision With 30 years of development and partnership, Volkswagen Group China is driving China s sustainable future through innovation, performance and responsibility 52

53 PLACEHOLDER BILD FOR PICTURE Market Development and Outlook Weiming Soh Executive Director, Volkswagen AG Member of Board, Volkswagen Group China 53

54 Disclaimer This presentation contains forward-looking statements and information on the business development of the Volkswagen Group. These statements may be spoken or written and can be recognized by terms such as expects, anticipates, intends, plans, believes, seeks, estimates, will or words with similar meaning. These statements are based on assumptions relating to the development of the economies of individual countries, and in particular of the automotive industry, which we have made on the basis of the information available to us and which we consider to be realistic at the time of going to press. The estimates given involve a degree of risk, and the actual developments may differ from those forecast. Consequently, any unexpected fall in demand or economic stagnation in our key sales markets, such as in Western Europe (and especially Germany) or in the USA, Brazil or China, will have a corresponding impact on the development of our business. The same applies in the event of a significant shift in current exchange rates relative to the US dollar, sterling, yen, Brazilian real, Chinese renminbi and Czech koruna. If any of these or other risks occur, or if the assumptions underlying any of these statements prove incorrect, the actual results may significantly differ from those expressed or implied by such statements. We do not update forward-looking statements retrospectively. Such statements are valid on the date of publication and can be superceded. 54