Lunar New Year: There was a time when U.S. CEOs thought China was a land of opportunity. But this golden age is showing signs of coming to an end.
After years of rapid growth, some of America’s most powerful technology companies are beginning to decline rapidly in the world’s second-largest economy.
The relationship between the Chinese government and foreign companies has gradually reached a dead end, while domestic companies have accelerated their development and become substitutes. All of this creates a dangerous race to please consumers.
“Business Insider” stated that it is not surprising that American companies, once considered the “Chinese Century”, have to learn the painful lessons of doing business in a country with billions of people.
Sales fall, capital evaporates
Just look at the tech sector and how American companies are doing in China.
Apple is trying to convince Chinese users to buy new iPhones. Counterpoint Research expects sales to plummet 24% in the first six weeks of 2024.
Meanwhile, shipments from Tesla’s Shanghai Gigafactory fell sharply last month to just 60,365 vehicles, according to Bloomberg. The company’s January shipments fell 16% from a year earlier and 19% from a year earlier, according to the China Passenger Car Association.
In the short term, this may not cause much disruption.
Apple’s net sales in China may have dropped 13% in the last three months of 2023 from the same period last year, but total revenue still reached $20.8 billion. Tesla isn’t the only electric car company facing declining sales, either.
But “Business Insider” said that these figures indicate that the two largest American companies in China are experiencing a period of decline.