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Recently, SAIC GM announced that its cumulative production and sales have exceeded 20 million vehicles, becoming the third joint venture with cumulative production and sales of 20 million vehicles after SAIC-Volkswagen and FAW-Volkswagen. SAIC GM said that since the first Buick New Century sedan went offline in 1998, it had taken only 23 years to achieve this goal, a rate that set a new record for the growth of China's auto industry.

It is worth mentioning that although SAIC GM has once again ushered in a historic moment, there are great hidden worries about SAIC GM's performance in the domestic market. According to the data, SAIC GM's sales rose slightly to 116772 vehicles in July, a rare increase. In terms of sales for the whole year, SAIC GM suffered the biggest decline in sales among the top five manufacturers, with cumulative sales falling 22.5 per cent to 673753 vehicles from January to July.

Looking at SAIC GM's sales results in the past two years, it is found that during the two years from June 2018 to June 2020, only a small increase in sales occurred in June 2019, and this time coincided with the period when the five countries changed countries six. It is not surprising that the major car companies have increased discounts to clean up the inventory of the five countries.

The reason is that SAIC GM's continued decline in sales has something to do with its three-cylinder engine strategy. Before 2020, Chevrolet Corruze, Kowoz, Volando, Buick Yinglang, Shilang, GL6 and other models were all equipped with three-cylinder engines, until the sharp decline in brand reputation and sales, GM lost a serious share of the domestic market and began to plan some models to return to the four-cylinder engine market. Judging from the data, the sales growth after returning to the four-cylinder engine is immediate, but absent from the four-cylinder engine market for many years, it will not be easy to overtake again.

Over the past two years, under SAIC GM's three-cylinder engine strategy, sales of Buick and Chevrolet brands have both declined. Cadillac, as a luxury brand, has become the pillar of SAIC GM, continuing to win the top spot for second-tier luxury brands, but Cadillac's performance is not optimistic. Cadillac's cumulative sales fell 6.3 per cent to 213717 in 2019, making it the only luxury brand to show a decline, according to the data. In 2020, Cadillac was continuously overtaken by Lexus. From January to July, Cadillac sales fell 19.3% to 104360 vehicles, while Lexus increased by 7% to 117651 vehicles.

In fact, it is expected that Cadillac was overtaken by Lexus, and its brand image has been seriously damaged by "price for quantity" over the years. It is understood that during the inventory clearance of national five models in mid-2019, Cadillac sold new cars at a minimum discount of 50%, and the terminal price dropped as low as 200000 yuan. Cadillac experienced a double-digit decline. On the second day of the listing of Cadillac CT4, there was news that Cadillac offered a discount of 250, 000 yuan to 30, 000 yuan, which eventually caused Cadillac to lose its position at the top of the market at the expense of brand premium.

More dangerously, SAIC GM, as a joint venture brand, may also be overtaken by its own brand Geely. It is understood that Geely ranked fourth among domestic auto companies in 2019, with a gap of only 238542 vehicles between Geely and SAIC GM, which ranked third. From January to July, the gap between Geely and SAIC GM narrowed to 33309, and Geely's sales showed double-digit growth. SAIC GM's three major brands collectively speak down, and it is not impossible to be overtaken by Geely.

Luo Lei, deputy secretary-general of the China Automobile Circulation Association, believes that American models lack heavyweight new models, and the lack of competitiveness is the direct reason for the declining performance of American cars in the Chinese market. Obviously, SAIC GM has obviously lagged behind the first camp, and as the second largest sales pillar of SAIC Group, it will also affect SAIC's overall sales.

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