Why there are so many Chinese cars in Kazakhstan and do they pose any threat

Business news correspondent
China may be interested in the removal of used cars from the country / Photo: Shutterstock, photo editor: Arthur Aleskerov

Nariman Bekturov, head of marketing and client service in JAC Motors Qazaqstan revealed the reason Chinese cars have flooded the Kazakhstani market.

«There was a lack of supply as many budget models and brands left our market. Of course, the Chinese saw those empty niches and occupied them. Why? Because their cars are more affordable. Furthermore, they produce quite good vehicles that offer nearly the same level of comfort as many more expensive cars,» Bekturov said during a speech at the Kursiv Auto 2024 forum in Almaty.

As he noted, Chinese automakers often offer various financial incentives to promote their sales.

«As a result, they have achieved explosive growth in the budget segment. They’ve occupied this niche simply because it was available. It doesn’t matter if these cars are made in China or elsewhere. They should be cheap and have good quality,» Bekturov stated.

Arthur Miskaryan, head of the Auto Market Monitoring and Analysis Agency, believes that the Chinese brands’ expansion in Kazakhstan was inevitable. Even though the automobile industry emerged in China in the 1930s, its massive growth began just 30 years ago. Over the past three decades, it’s been the most rapidly growing market in the world. It has faced some stagnation just recently, though.

«The expansion of Chinese auto brands in Kazakhstan follows recent geopolitical events. Some Western brands stopped operating in Kazakhstan, so adding Chinese brands to auto dealer portfolios was just a matter of time. It was an existential issue for auto businesses. Their stocks of European or Japanese cars were gradually depleting, while their financial obligations to staff and banks, which financed the construction of new auto centers, remained,» Miskaryan explained.

Another important factor is the political stance of the Chinese government, which is very proactive in promoting Chinese automakers in global markets. The central government or regional governments of China often own stakes in many Chinese auto companies.

«Don’t forget that because of the stagnation I already mentioned, the Chinese government is ready to take any necessary measure to support the industry. This approach is quite consistent and it is going to be even more aggressive,» the expert underlined

He believes that China is set to promote brand-new cars in the domestic market. This is why the country’s authorities may put more effort into replacing used cars with new ones.

«In other words, China is going to support the removal of used cars from the country to spur the demand for new cars. This is something that Kazakhstani dealers and the regulators must keep in mind,» Miskaryan said.

Kursiv Auto 2024 is the first independent forum for the key participants of the automobile market, experts, industrial associations and regulators organized by Kursiv.media.

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