Luxury cars showcase the future: Who is the leader in automotive innovation?

Since 1985, the Shanghai Auto Show has gone through 32 years, from the Santana sedan produced in CKD (Completely Knocked Down) mode to the large-scale appearance of internet cars at the Shanghai Auto Show. On April 19, the Shanghai Auto Show arrived as scheduled.

Unlike previous years where there was a clear distinction, this year at the Shanghai Auto Show, emerging companies and traditional car manufacturers are both competitors and partners.

Transformation is a topic that every traditional car manufacturer must face. Traditional car companies represented by luxury cars have been exploring and moving forward amid changes.

However, as technological leaps, smart connectivity, electrification, and autonomous driving become clear directions for the future development of the automotive industry, both new force car manufacturers and traditional luxury car companies stand on the same understanding point.

It is worth noting that in the first quarter of 2017, major luxury brands in the domestic market continued to grow rapidly, with BMW, Mercedes-Benz, Cadillac, Jaguar Land Rover, Lexus, Volvo, and Lincoln all showing double-digit growth.

The first camp continues to lead new technology?

Mercedes-Benz, which has maintained a growth trend in China for 49 months, showed no signs of weakening in the first quarter of 2017: over 150,000 Mercedes-Benz and smart cars were delivered in China in the first three months, a year-on-year increase of 37%.

"As the inventor of the automobile, we will not have any slackness or pride because everyone in this field is moving forward bravely. We have no reason to stop when everyone else is advancing; we will continue to work hard towards leading future trends," said Tang Shikai, a member of Daimler's board of directors, to reporters from the 21st Century Business Herald on April 19. Last year at the Paris Auto Show, Daimler announced its transformation from a leading luxury car manufacturer to a leading mobility solutions provider for the new era and released its 'C.A.S.E.' strategy, which includes smart connectivity, autonomous driving, shared mobility, and electric drive.

"We will spare no effort in exploring relevant technological fields." According to Tang Shikai, Daimler was the first luxury car manufacturer to provide car-sharing services in China. In 2016, it introduced 'car2go' into China and will continue to increase investment in mobile travel.

In terms of intelligent driving, Mercedes-Benz globally launched its new generation S-Class sedan representing its highest intelligent technology on the eve of the auto show and is seeking local cooperation with high-precision map providers in China. Currently, Mercedes-Benz's autonomous driving models can achieve automatic overtaking, control distance from the vehicle ahead, and even control vehicle steering.

For Mercedes-Benz's old rival BMW, its strength displayed at this auto show cannot be underestimated.

"More than five years ago when we started developing the new generation 5 Series, we began to ask ourselves what changes our customers were experiencing. The middle class in China is rising and becoming broader and younger; they are the youngest customer group globally," said Gao Le, Senior Vice President of Marketing at Brilliance BMW on April 19.

Against the backdrop of maintaining a dominant position in its segment with the previous generation 5 Series, the launch of BMW's new 5 Series Li at this auto show can only be seen as the beginning of its product offensive.

Industry insiders believe that what BMW truly needs is to continuously exert effort by launching new models such as the new generation 3 Series and X1 as well as the upcoming X3 to expand its product line to compete with Mercedes-Benz.

In addition to product layout and channel construction, BMW's new energy vehicles will be a new pivot for maintaining its leading advantage. It is reported that in 2016 BMW's global sales of new energy vehicles exceeded 62,000 units. By the end of March this year, Brilliance BMW's second model under its brand Zhi Nuo officially went on sale. In 2017, BMW Group set a global sales target of 100,000 units for new energy vehicles.

The ceiling made up of hundreds of LED screens floats with brilliant lights and stage effects; Audi's booth design amazed many onlookers. However, it completely copied last year's Paris Auto Show stage. But Audi has always regarded itself as 'breaking through technology and inspiring the future,' so how it drives brand development with innovative technology is particularly important at this stage.

Notably, Audi globally launched its Audi e-tron Sportback concept pure electric vehicle at this auto show. This model is equipped with a quattro all-wheel-drive system powered by one electric motor on the front axle and two electric motors on the rear axle. The system power output reaches up to 320 kW in boost mode and can even reach up to 370 kW; it accelerates from zero to one hundred kilometers in just 4.5 seconds and achieves a maximum range of up to 500 kilometers.

However, in reality, traditional luxury brands represented by Audi are experiencing slowed growth that has differentiated their inherent advantages; diversification has become a trend among Chinese luxury car brands.

The second camp is rising rapidly. The second camp of luxury brands is also rising quickly.

"Currently there are four major trends in the global automotive market: autonomous driving, shared mobility, smart connectivity, and electric drive. For Jaguar Land Rover, we need to start exerting effort right from the starting line," said Pan Qing, Global Director and President of Jaguar Land Rover China. "By 2020 nearly half of Jaguar Land Rover's models will be equipped with new energy vehicle technology."

In today's emphasis on personalization, Jaguar Land Rover is expected to welcome new opportunities. In 2016, Jaguar Land Rover sold a total of 119,000 vehicles in China with a year-on-year increase of 28.7%; in the first quarter of 2017, Jaguar Land Rover set a new quarterly sales record in China with cumulative sales reaching 34,000 units and a year-on-year increase of 22%.

At this auto show, Jaguar Land Rover China teamed up with Chery Jaguar Land Rover to bring five new cars together; among them are two models making their Chinese debut—the Jaguar I-PACE concept car is very close to mass production with a single charge range reaching up to 500 kilometers. It is reported that this model will enter the Chinese market in 2018. It can be seen that Jaguar Land Rover has begun its 'big gamble' in this market after being somewhat conservative in terms of new energy layout previously.

Volvo shares similar status as Jaguar Land Rover within the second camp; it stirred excitement at its booth due to actor Peng Yuyan's appearance. The heavyweight models launched by Volvo this time—the all-new Volvo V90 Cross Country large luxury off-road station wagon and S90 long-wheelbase T8—also gained significant attention thanks to Peng Yuyan's endorsement.

During this period, Volvo officially announced its vision and plans for welcoming the era of electric vehicles; Volvo will use China as its electric vehicle production base and expects to start mass production of its first electric vehicle brand by 2019.

It is reported that this electric vehicle will be built on CMA small modular architecture platform and shares the same foundation as the new generation Volvo XC40 series vehicles. Additionally, an electric vehicle based on SPA expandable architecture platform is also under development.

In response to the impact of new car manufacturers on traditional car companies, Yuan Xiaolin, Senior Vice President of Volvo Car Group and President and CEO of the Asia-Pacific region, stated in an interview with the 21st Century Business Herald that everything will be tested by the market.

"Many people are making efforts for this, which is very commendable. As a company with a long history, we have an understanding of the world and are continuously increasing our investment to establish a complete system. This will provide us with better support to adapt to the requirements of the new era. We have the strength to do this and confidence to let the market test it."

However, Yuan Xiaolin admitted that he does not like to define Volvo as a 'second-tier luxury car.' On the surface, it seems that Volvo does not recognize the segmentation based on sales, implying that Volvo will be a more luxurious, innovative, and vibrant brand with safety as its core in the future.

"Currently, Volvo has begun launching new products based on the SPA platform. This is our strength. This year, the entire 90 series has been completed, and in the future, we will launch new models at a rate of two per year. We need to solidly do our foundational work and maintain our strengths, rather than blindly following market fluctuations and engaging in many short-term behaviors," said Yuan Xiaolin.

It seems that this year's Shanghai Auto Show is more like a storm; in the face of the impact from new forces in car manufacturing, the new technologies and products brought by traditional car companies are not only for display but also seem to seriously declare their dominance in the field of automotive innovation.