BEIJING (dpa-AFX) - In China's fiercely contested automotive market, German manufacturers are struggling to keep pace in the EV segment. They are determined not to let history repeat itself when it comes to autonomous driving functions and digital services. The Beijing Auto Show, which has just opened, demonstrates that the next race is in full swing. The outcome will be decided by software, driver assistance systems, and AI integration in the cockpit.
At the same time, the trade fair opens against the backdrop of a market that has lost significant momentum. Beatrix Keim from the Center Automotive Research (CAR) speaks of a 'stagnation phase'. 'The Chinese market is not only characterized by enormous competitive intensity, it is also undergoing a harsh consolidation phase,' confirms Peter Fintl, technology expert at the consultancy Capgemini.
Price war weighing on the market
The multi-year price war is particularly problematic. Many manufacturers have offered their vehicles at increasingly lower prices, sometimes to the point where little to no profit could be made. This has now become a political issue, with authorities taking tougher action against 'ruinous price competition'.
For German manufacturers, it will be another 'tough year', according to Keim. She believes a genuine comeback is only possible from 2027 onwards, once the latest models have gained traction with customers.
Better times ahead for German manufacturers?
In the past, wealthy Chinese consumers preferred to signal their status with Western premium brands such as Mercedes, BMW, or Audi. Today, the landscape has shifted. 'Chinese customers have become more patriotic,' says automotive expert Philipp Kupferschmidt from the consultancy Accenture. Combined with price differentials, many factors now favor Chinese vehicles.
However, the wave of consolidation in the Chinese market should benefit the Germans, says Kupferschmidt. 'Prices are expected to rise again in the foreseeable future, and then the outlook for German automakers will improve once more,' the expert notes.
Focus on connectivity
The People's Republic was once the primary growth engine for German automotive groups, delivering exceptional margins. They have since had to adapt: more local development, faster model cycles, software partnerships, and technology tailored specifically to Chinese consumer preferences. Kupferschmidt sees further room for improvement: 'A small local development center with 40 people for superficial modifications is not enough. From a German perspective, one must also be able to let go,' the expert advises developers in Wolfsburg, Stuttgart, and Munich.
Once again, the trade fair showcases a wealth of technology, aligned with the motto 'Future of Intelligence'. Cui Dongshu, Secretary General of the Chinese industry association CPCA, expects 'major upgrades in the next generation of vehicles' regarding autonomous driving and connectivity. The goal is to enable highly automated driving in more vehicles and across more scenarios - on highways as well as in urban traffic. Simultaneously, more Artificial Intelligence is being integrated into the vehicle.
Mercedes showcases assistance system
Mercedes is demonstrating this with its 'Navigation Guided Assist' (NGA), which allows the car to drive itself from point A to point B. During a test drive in Beijing's chaotic traffic, Mercedes developer Yunfei does not have to intervene for over half an hour. The Level 2++ autonomous driving assistant merely requires him to touch the steering wheel every 15 seconds.
Oncoming traffic during left turns, scooters during right turns, and double-parked cars in narrow streets pose no problem for the AI-powered assistant. The group plans to offer the software nationwide by the end of the year, extending beyond metropolitan regions like Beijing and Shanghai. However, many Chinese manufacturers have already been offering such features for some time.
Expert: 'We still have what it takes'
Only a year ago, a fatal car accident involving an activated driving assistant called the marketing methods of some brands into question. The government intervened, reigning in manufacturers who marketed their systems too aggressively. Since then, stricter requirements for safety and advertising have been implemented, while robotaxi services are becoming more visible in everyday Chinese life.
Another trend is China's push into the luxury segment. What Chinese manufacturers are demonstrating here in terms of 'customer experience, range, and fast-charging capability can compete with the world's best,' says Fintl. The automotive expert sees no chance of a return to German dominance in the Chinese market. But it is not the end, either. His conclusion: 'We still have what it takes, but we are under enormous pressure.'/jpt/DP/stk
