Zhejiang Geely Holding Group together with General Motors Chinese venture are preparing to launch its first pickup truck models, intensifying competition in a segment dominated by Great Wall Motor.
Geely revealed its first pickup truck model last week at a company event publicized on social media, while formal documents showed a joint venture of automakers including GM seeking approval to build its first pickup truck model.
The companies are attempting to tap into the niche market, which still accounts for less than 2% of total vehicle sales in China, but that has outperformed as regional governments ease coronavirus led restrictions on their entry into urban areas.
China sold around 251,000 pickup trucks in the first seven months of this year, according to the China Association of Automobile Manufacturers (CAAM). That represented a 1.4% decline from the same period last year but was more modest than the 12.7% decline in overall vehicle sales over that period.
Documents on the website of China’s Ministry of Industry and Information Technology showed a joint venture between General Motors, state-owned SAIC Motor, and Guangxi Automobile seeking government approval to work on its first pickup truck model Zhengtu.
Meanwhile, Geely is building an automobile plant that will have a yearly manufacturing capacity of 100,000 vehicles, including pickup trucks, located in China’s eastern city of Zibo, construction bidding documents on the company website revealed.
Geely and GM representatives refused any further comment.
The plans come as pickup truck sales are gathering pace compared to some of its rivals.
Great Wall Motor, China’s largest pickup manufacturer, experienced pickup sales increase by 38% in the first seven months of this year compared to last year because of its new P-series models.
By comparison, the sales of sport-utility vehicles and of sedans dropped 11% and 22% respectively over that period.
But Cui Dongshu, secretary general at China Passenger Car Association (CPCA), does not expect any major increase in sales over the long term even if the government curbs ease further.
“There is still a lack of demand for pickup trucks from normal Chinese customers,” he said. “They are more familiar with SUVs and sedans.”