Before the impact of the 2008 financial crisis, some Chinese brands had ambitious plans to enter the US market. Then Chery talked about building a factory in Nebraska and expected to conquer up to 10% of the US market.
Although the factory was never built and the company did not manufacture any model in the United States, it did try in Europe with a vehicle that sought to compete in the premium segment, but was ultimately unsuccessful.
After this experience, Chery and other Chinese manufacturers understood that before playing in the “big leagues” they had to attack less demanding and smaller markets. Some decided to use Australia as a kind of test market. Others entered Latin America with force.
A strategic market
Chery, which markets its products in Brazil, Chile, Peru, Ecuador, Paraguay, Uruguay and Bolivia, arrived in Mexico in mid-2022 with the Chirey brand. Today, the country is a key market for the expansion of the automotive group in North and South America.
“Mexico is a strategic platform for us due to its geographical location and the number of international treaties it has with the rest of the countries in the region,” said Guibing Zhang, CEO of Chery International Company, the division in charge of new markets.
Zhang, who is responsible for the expansion of the international operation of the brand, said at a press conference that now the objective is to build a plant in the country to export to the rest of America. “We are looking at several locations,” he added.
San Luis Potosí, Puebla and Nuevo León are some of the locations that are on the table, and the expectation is that the plant will start operations in 2025, just when the group plans to enter the US market.
“It’s China Time”
China, which in 2012 surpassed the United States in vehicle production, seeks to consolidate itself as an automotive power with a clear commitment to electric mobility and autonomous driving.
“American brands dominated at the beginning of the 20th century thanks to the production line system. Then, the Japanese and South Koreans took the lead in the 1970s, amid gasoline shortages with their small and efficient models. The modular platform of Volkswagen gave Germany a competitive edge in the 2000s. But now it’s China’s time,” Zhang said.