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According to a report released by the Federation of passengers, retail sales in the domestic passenger car market in July were 1.72 million, down 2.8% from a year earlier, of which retail sales of new energy vehicles were 878000, up 36.9% from a year earlier, while retail sales of traditional fuel vehicles were 840000, down 26.0% from a year earlier.

The scale of the fuel vehicle market continues to shrink under the strong attack of new energy vehicles, which is a fait accompli. According to the Carriage Federation, retail sales of independent brands in July were 1.06 million, up 13 per cent from a year earlier, with a domestic share of 61.8 per cent, while retail sales of mainstream joint venture brands were 440000, down 25 per cent from a year earlier, compared with 25.6 per cent in the same month. Luxury car retail sales of 220000 vehicles, down 11% from a year earlier, also showed a decline in market share of 12.5% in the same month.

According to the list of retail sales of domestic car companies published by the Federation of passengers, it is not difficult to see that the pressure of market competition is huge and the polarization is very obvious. Auto Industry concern found that BYD alone has surpassed all departments of the market. BYD's retail sales in July were 312000 vehicles, up 35.0% from a year earlier, with a market share of 18.1%. The market share of German, Japanese and American brands was 17.6%, 12.9% and 5.8%, respectively, showing a year-on-year decline. This is the first time that BYD's market share has surpassed that of Germany. This is not only a historic moment for BYD, but also a historic moment for Chinese cars. For comparison, BYD had a 15.9% share of the domestic market in June, compared with 18.6% for German brands.

In 2022, BYD overtook FAW-Volkswagen to become the first domestic manufacturer with 1.805 million vehicles, with the latter selling 1.779 million vehicles for the whole year. Prior to this, FAW-Volkswagen has won the domestic passenger car sales title for three consecutive years, with sales of 2.072 million, 2.11 million and 1.778 million vehicles respectively from 2019 to 2021. At that time, "Automotive Industry concern" had asserted that BYD would continue to erode the joint venture brand market by relying on new energy vehicles, and it would be very difficult for FAW-Volkswagen to return to the first place of domestic manufacturers. Today, two years later, BYD has surpassed not only Volkswagen brands in China, but also the entire German brand, including BMW, Audi, Mercedes-Benz and so on.

Germany is a traditional power in the automobile industry, with a hundred years of automobile design and production history and a perfect industrial supply chain. However, in recent years, with the acceleration of the trend of automobile new energy transformation, German car-making "old master" has encountered new problems, and the three German giants Volkswagen, Mercedes-Benz and BMW have experienced reverse sales growth in the Chinese market.

As we all know, about 30% of Volkswagen's sales come from the Chinese market, which is the world's largest single market, and now Volkswagen's sales in China are also weak. Volkswagen sold 149000 vehicles in China in July, while Audi sold 45000, according to retail data.

Retail data show that FAW-Volkswagen sales in July were 114200 vehicles, down 22.6% from the same period last year. The reason why FAW-Volkswagen sales declined so badly was that it owns Volkswagen, Jetta and Audi brands, all of which declined. Among them, the Jetta brand fell 41.6%, the Volkswagen brand dropped 21.4%, and the Audi brand dropped 20.0%. SAIC Volkswagen sold 88200 vehicles, down 11.8% from the same period last year, including Volkswagen brand down 12.5%, Audi brand up 50.1%, Skoda brand down 39.9%. Although Audi brand has achieved substantial growth, its share in SAIC-Volkswagen system is relatively small, unable to make up for the loss caused by the decline of Volkswagen brand.

The same is true of Mercedes-Benz and BMW, which sold 49000 vehicles in July, down 18.2 per cent from a year earlier, while Beijing Mercedes-Benz fell 7.0 per cent to 47000. In the era of fuel cars, BBA has its own unique halo, with excellent comfort and handling has become a popular fashion. However, with the growing strength of independent high-end brands, the proportion of brand influence in consumers' intention to buy cars is gradually weakening, and the hardware and software strength of cars has become an important indicator for consumers to consider. In this context, if BBA can not follow the path of technological innovation in time, it will not increase sales even at the expense of brand value.

In terms of models, the German brand sold more than 10,000 models in July, including Longyi, Passat, Mercedes-Benz C-Class, Mercedes-Benz GLCs, Maiteng, Audi A6L, Tanyue, Audi Q5L, BMW 3-Series and Tuguan L. among them, the Volkswagen brand sold the highest vehicle Lang Yat, with 24000, Audi A6L with 12000, and Mercedes-Benz C-Class with 14000. The BMW brand has only one model with more than 10,000 vehicles, compared with 11000 for the BMW 3-Series.

In the wave of electrification, the rapid rise of Chinese car companies has brought about the decline of fuel vehicles, the inventory of joint venture fuel vehicles has been overstocked, the market share has been declining, and finally the joint venture manufacturers are forced to join the price war. But what is sad is that the more outrageous the price reduction of fuel vehicles is, the less people will buy them. In the end, it is the dealers who are under pressure. If they sell them, they will lose money, and they will suffer if they cannot sell them. As a result, more and more dealers are losing money and resell their own brands of new energy vehicles.

Industry insiders say it is expected that China's fuel vehicle market share will be further reduced by 2030, when 3/4 of the Chinese market will be electric vehicles. "Foreign car brands should not sell cars in a smaller and smaller market, but must build their own competitiveness in electric vehicles, and to improve their competitiveness, it is a good way to cooperate with Chinese new power car companies."

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