Taking an in depth look at how EU Autos earn in China
Given recent slower growth in German OEMs in China, we carry out an in-depth
China earnings analysis for the EU OEMs and EU Suppliers and quantify exposure
by company. We reiterate our cautious view on Chinese Mass and Premium
markets (growth, pricing & margins) and companies with high China exposure.
We see German brands continuing to lose share in 2015
China market growth is trending roughly in line with our 7% est for the year, but so
far 2015 has been a great year for local Chinese brands, as they have substantially
outperformed Global JV brands (+29.1% vs +1.1%). We think this can continue as
the consumer looks for lower prices in a tough macro environment and local quality
improves. We forecast only +2% for VW Pass Car in 2015 and +3% for Audi / BMW.