One of the largest Mercedes dealerships in China has closed its doors, surprising the market. Now it is embarking on the promising world of electric vehicles.
One of the largest dealerships Mercedes-Benz of China, located in Hunan province, has ended its sales of vehicles of the brand german.
Instead, it will now market electric cars from a technology company that is just entering the automotive sector.
The change is no surprise. In China, consumers are increasingly interested in local brands, opting for vehicles that offer advanced technology and cutting-edge connectivity.
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The preference for Chinese manufacturers is growing rapidly, leaving behind European brands that dominated the market for decades.
This movement reflects a profound transformation in the automotive sector. The transition is not only between combustion engines and electric vehicles, but also in the way consumers view vehicles.
The rise of Chinese brands in the automotive sector
Hunan's largest Mercedes dealership is now a store for AITO, the new electric car brand from Huawei, one of China's tech giants.
The Aito M9, an SUV developed in partnership with Seres, is an example of the new market standard. The car has more screens than seats, highlighting the Chinese priority for digitalization.
Over the past 20 years, China has been a crucial market for European carmakers. However, some have been overly dependent on the Asian market and are now facing significant challenges. Mercedes-Benz reported a 2024% drop in sales in China in 7. The situation is even more worrying for BMW, which saw its sales plummet by 13,4%. However, the brand most affected was Porsche, which sold 28% fewer cars compared to the previous year.
The changing profile of Chinese consumers is one of the main factors behind this decline. Today, buyers prioritize vehicles with high technology, advanced connectivity and sophisticated autonomous functions. These aspects trump brand tradition, a factor that previously weighed more heavily in the purchase decision.
Another crucial point is the government’s strong incentive for electric cars. China is investing heavily in the expansion of its battery industry, which makes local electric vehicles much more competitive in terms of price and performance compared to European models. Almost half of all new cars registered in the country are electric, and consumers can find affordable and technologically advanced options in abundance.
The most emblematic example is Xiaomi's electric car. The basic version costs around 29 thousand euros and offers a range of 700 kilometers. The premium version, Xiaomi SU7 Max, has a range of over 800 kilometers and costs less than 40 thousand euros.
With an 800-volt electrical system, ultra-fast charging and full integration with the brand's technological ecosystem, the vehicle quickly won over Chinese consumers.
The heavy Chinese market
Fierce price competition, combined with high demand for advanced technology, has put European brands in a delicate position.
What was once seen as a promising market has now become a significant challenge for companies like Mercedes, BMW and Porsche.
Given this scenario, the change from a large dealership to a local brand like AITO reflects a trend that seems irreversible.
Chinese consumers are increasingly turning to domestic options, driven by advanced technology, competitive prices and government support.
Western brands, in turn, face an unprecedented challenge: reinventing themselves or losing ground in one of the most dynamic markets in the world.