The_Assessor_Summer 2026 Web - Flipbook - Page 24
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assets from Nanjing, where SAIC
was at the time a signi昀椀cant partner
of General Motors and Nanjing was
so chaotic it went bust. One of the
un昀椀nished projects was developed with
the assistance of Ricardo PLC under
the entity ‘Ricardo 2010’. Starting in
2004, the project delivered the vehicle
by around 2008.
1. Create a model benchmark to within
fractions of a millimetre of perceived
international competitors. Of
course, this is what all other volume
manufacturers also do.
Ricardo 2010 was not about a single
vehicle – which became Roewe and
MG models – it was about establishing
an independent SAIC-owned vehicle
creation unit, not beholden to any
other company. So, the MG5 and
MG6 were well-received products
with famously poor sales, which
re-established the bones of importing
vehicles, parts, dealerships and more.
3. Get the new model to ‘score’ very
well in one of two Euro NCAPapproved test labs located in China.
A decade later, and thanks to the
huge domestic market, MG Motor
was able to refresh models quickly,
understood the quirks of the UK
market, understood the requirements
of UK insurers, and started to roll the
enhanced business model right across
the EU27.
It was MG Motors’ sales success that
rattled the EU27 Commission, resulting
in direct discussions about import
duties. For once, the Commission
looked beyond one model, one
company and decided others – Chery,
BYD and more – could also quickly
gain market share.
THE GREAT REPAIRABILITY
DEBATE
For some time, in an effort to reduce
costs, the service element of new
vehicle design has not merely
taken a back seat but, in effect,
become a voiceless passenger. The
demands to meet market-segment
consumer expectations, to comply
with signi昀椀cantly expanded legal
obligations without which a new
vehicle cannot be sold, along with the
unaddressed underlying economics
of building in relatively high-taxation
/ high-labour-cost markets, meant
service – in our world, repair – was a
by-product. The irony is, of course, that
parts sales remain a very important
source of pro昀椀t.
Thatcham Research, via their
connections to RCAR, have been able
to assist China-based manufacturers
in managing their low-speed damage
costs, the biggest component of the
insurance rating system that a vehicle
manufacturer has any control over.
The upshot was the discovery of a
‘code’ understood by China’s vehicle
manufacturers.
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2. Comply with all EU27 type approval
– which is a legal obligation, and
covers the UK too since we still use
the very same legislation.
4. Turn up at the insurers with parts
pricing and the excellent Euro NCAP
results.
The missing step? Low-speed
damageability, which in the UK has
standardised impact scenarios, from
which the ‘basket of parts’ and labour
costs are calculated.
Worse.
Bumper beam crush cans prevent
low-speed impact damage from going
into the main front or rear chassis leg.
In the Euro NCAP testing, the bumper
beam crush can makes almost no
difference to the overall result because
of the signi昀椀cantly higher levels of
impact energy. Some China-based
vehicle manufacturers, whose new
models had already got impressive
Euro NCAP test suite results, missed
the signi昀椀cance. So, damage appeared
on the front chassis leg, compounded
by parts supply of only a larger
sub-assembly including the front strut
tower.
Suddenly, a reasonably priced SUV with
BEV, PHEV, HEV or ICE power was at
risk of becoming disastrously expensive
to insure.
Fear not.
Recommendations were made, the
design correction along with simulation
completed in a matter of days. The
next stage was no less remarkable
– the redesigned crush can was
re-tooled, made and was in the
assembly plant in 1.5 months. Now
– Europe is more than capable of
matching this speed, but it has been a
long, long time since it needed to do
this, not as an exception, but routinely.
Every single China-based manufacturer
is licenced by the state to make
vehicles, without which they cannot
make or sell vehicles. This includes
vehicles for export only. The majority
of China’s vehicle manufacturers are
funded by the State or Provincial
Government, and in some cases are
owned by them as well.
The key to the export drive is a ruinous
price war in the domestic market over
the past four years which has led to
the departure of most of the
‘foreign-to-China’ brands, combined
with pro昀椀ts on every single vehicle
sold outside of China compared with
almost none if sold within China. To
service the investment debt, vehicle
manufacturers need pro昀椀ts, and those
are abroad.
Due to the intense home-market
competition, models are endlessly
refreshed. Whereas a European
manufacturer would seek to tool a
model range to cover BEV and PHEV,
the China equivalent thinks nothing of
major surgery as a running change.
It is the speed of the re-tooling
– pressings, castings, plastic parts
– that is staggering. Meanwhile, the
‘look’ of light bars, glass planks in
the interior and endless tiny design
variations has drawn rebukes, even
from President Xi Jinping.
As such, the vehicles are not always
new, but simply new to us. Just as
China’s consumers looked towards the
internet 10 years ago, we now do the
same. Much of the innovation is
over-hyped, but the overlap with
sectors such as battery production and
mobile software is inescapable.
THE REALLY BIG DEBATE ABOUT
DESIGN FOR REPAIRABILITY
Many of the vehicle systems are 昀椀tted
onto or into the body shell in ways that
were not common even 10 years ago.
The result is that the cost of removing
extra layers of parts to reach the
damage zone adds repair costs... ‘time
is money’.
There is a risk that the traditional motor
insurance model and collision repair
business could be badly damaged
by ‘uneconomic repair’ costs, as has
already been seen over the past
decade. Could the China-based vehicle
manufacturers self-insure, or insure via
a China-backed bank, or simply ensure
any damaged vehicle is replaced with
a refurbished vehicle? Consider just
how many new car transporters arrive
in Europe, and how many, for the time
being, return empty.
Can the China drive for EU27 and
UK vehicle market domination beat
the reformation of the European
automotive manufacturing business to
address uncompetitive costs?
Hundreds of thousands of European
automotive manufacturing jobs have
already gone since 2020, and more
than that are at risk.
Game, set and match to China? Maybe
not. Competition really is healthy.
THE ASSESSORS JOURNAL | SUMMER 2026 | www.iaea-online.org/news/the-assessor
JOURNAL
