Feng Yubing, commercial manager of JAC Motors International , landed in Mexico in early August to spend four months in the country. His stay, the “longest” he has had so far in Latin America, is due to the growing interest that China has in the Mexican market.
“Before I used to spend periods of a month, but now I will be here for a longer time. The intention is to visit cities and have contact with the local team”, says Feng, who uses the name “Diego” when he travels to the West.
Latin America is not an unknown region for him. Before 2015, Feng frequently traveled to Venezuela and Cuba – countries historically close to the communist regime – and with which China maintained an intensive commercial exchange. But the economic and political crises in both markets, says Feng, have blurred business opportunities.
Then the Chinese manufacturers, Jac included, began to explore new opportunities and found an “interesting” market in Mexico, not only because of its size, but also because it did not have as many trade barriers as the United States.
JAC Motors and the goal of selling 10,000 units
JAC arrived in the country in 2017, almost a decade after the corporation created the JAC Motors International division with the aim of expanding its presence outside of Asia, hand in hand with local business partners who had extensive knowledge of the markets they serve. wanted to arrive
“Building a relationship of trust with the local partner is very important,” says Feng, who belongs to the Jac International division.
In Mexico, this local partner is Giant Motors Latin America , a company that, before working with JAC, already sold trucks of the Chinese brand FAW, and that in 2016 decided to expand its commercial operation and try its luck with passenger vehicles. “We are looking for a Chinese brand interested in entering the Mexican market with local assembly,” Elías Massri, president and CEO of Giant Motors Latin America, said in an interview in 2017.
The launch of the brand was on March 28 of that year, at a dealership owned by Grupo Zapata, which also distributes other brands in the country such as Ford and Mazda. JAC started in Mexico with the goal of reaching an annual sales volume of 10,000 units from 2022, under a business model focused on attracting consumers who were looking for models with a high level of equipment but at competitive prices.
Five years later
Conquering new clients in Mexico was not easy. During its first few months in the Mexican market, JAC dealers dealt daily with questions about the quality of the models.
“People arrive with a lot of curiosity, thinking that they are going to find something poorly done, of poor quality. They pull the handles, they move the facias to see if they are not going to fall apart,” said Eugenia Solís, then commercial manager of Grupo Zapata, in 2017.
But Giant Motors Latin America – a Mexican company in which businessman Carlos Slim is a majority shareholder through Inbursa – has worked hard to change that market perception. A key pillar in the strategy has been to emphasize that behind the Chinese brand there is a Mexican company that not only takes care of the assembly of the models in a plant located in Ciudad Sahagún, Hidalgo, but also of after-sales.
Five years after its arrival, JAC is about to meet the goal of selling 10,000 units, which was set in 2017. Between January and August 2022, the brand’s dealer network has sold 9,789 units, according to Inegi data.
The offer of the Chinese brand in Mexico has been expanded to 50 versions of 19 models, both gasoline and electric, with which it covers several of the hottest segments of the moment, such as SUVs and pickups. One of the most recent launches is a compact SUV for five passengers, Sei 6 Pro , with which it will seek to compete with models such as Toyota RAV4 and Honda CR-V.
Feng participated in this launch together with the local Giant Motors Latin America team.
Although the brand has not made public a new sales goal for the next five years, managers have made it clear that they are not willing to back down. This year they will seek to strengthen their presence in the electric market, in which JAC has positioned itself as the leader with three passenger and three commercial models. They will also look to capitalize on the latest launches, such as the Sei 6 Pro compact SUV, and its range of pickups.
–Could JAC open its own office in Mexico?
-We believe that the strategy we have so far is the best for the brand. GML’s (short for Giant Motors Latin America) knowledge of the local market has allowed us to have a wide range of products. We are like a family and that is something highly valued in China.