When the Tide Recedes: Observations on Long-Termism and Product Quality Among Chinese Automakers
2024–2026 China Automotive Industry Research Brief
Research cutoff: October 10, 2026
Research focus: Price wars, product quality, safety accountability, long-term reliability, and user experience
Core Takeaway
An automaker that can survive over the long term is not necessarily one that can deliver high-quality products to consumers over the long term.
China’s new energy vehicle (NEV) industry continues to make strides in technical capability, manufacturing efficiency, and global competitiveness. Yet price wars, supply-chain strains, safety controversies, and after-sales service problems are also surfacing with increasing regularity.
When companies lower costs through economies of scale, platform sharing, and technological innovation, they create genuine value for consumers. But when they maintain a pricing advantage by cutting material specifications, compressing validation cycles, trimming engineering redundancies, or passing repair costs onto buyers, commercial success can come directly at the expense of consumers’ long-term interests.
This is why we must distinguish between two fundamentally different concepts when evaluating automakers:
- Commercial long-termism: Whether a company can stay profitable, advance its technology, expand market share, and remain a going concern.
- Product long-termism: Whether a company is willing to bear the costs required to ensure a vehicle’s safety, reliability, repairability, and owner protections over the next five to ten years.
The two can reinforce each other, but they are by no means synonymous.
1. Industry Trends: Technological Progress Alongside Quality Pressures
1. Initial quality issues in NEVs are still climbing
J.D. Power China New Energy Vehicle Initial Quality Study:
| Year | Problems per 100 Vehicles (PP100) | YoY Change |
|---|---|---|
| 2024 | 210 | — |
| 2025 | 226 | +7.6% |
| 2026 | 231 | +2.2% |
From 2024 to 2026, initial quality problems reported for NEVs rose by a cumulative total of roughly 10%.
The composition of these problems matters just as much. In 2026, about 70% were design- and experience-related issues spanning infotainment, human-machine interaction, and driver-assistance systems; growth in traditional mechanical and functional breakdowns has leveled off.
Therefore, these figures should not be read simply as an across-the-board decline in mechanical quality.
What they show instead is that rising intelligence and feature complexity are placing far higher demands on vehicle-level engineering, software quality, and user experience.
2. The price war is reshaping the cost of quality
Among the 33 publicly traded Chinese automakers surveyed by Reuters, the median net profit margin fell from 2.7% in 2019 to 0.83% in 2024.
Supplier price cuts, extended payment cycles, and inventory pressures reflect just how fierce the competition has become.
| Cost-Reduction Approach | Typical Measures | Long-Term Impact on Consumers |
|---|---|---|
| Technical cost reduction | Platform sharing, structural optimization, higher production yields | Can lower retail prices while improving quality |
| Scale-driven cost reduction | Parts commonality, centralized purchasing, production line automation | Generally positive, though quality consistency must be maintained |
| Supply-chain margin squeeze | Mandatory price cuts, extended payment terms | Can erode suppliers’ R&D and quality-control capabilities |
| Product-level cost cutting | Downgrading material specifications, cutting redundancies, compressing validation | Can compromise durability and safety |
| Service-level cost cutting | Downsizing service networks, reducing spare parts inventory | Drives up repair costs and turnaround times |
While supply-chain squeezes and product degradation are potentially linked, one cannot conclude that an automaker is cutting corners simply because procurement costs dropped or retail prices fell.
The real hazard lies in hidden quality compromises that consumers cannot easily detect on the showroom floor, but may end up paying for years later.
3. After-sales capability is becoming a new industry bottleneck
According to the J.D. Power 2026 China New Energy Vehicle Customer Service Index Study:
| Metric | Finding |
|---|---|
| Repair costs for collision-damaged vehicles | About 1.7 times those for ICE vehicles |
| YoY change in average spend per service visit | +23.3% |
| YoY change in service wait times | +45.6% |
| Net Promoter Score for service in a separate brand reputation study | Down 14.9 points YoY |
Low routine maintenance costs do not equal low total cost of ownership. Repair costs, spare parts availability, software support, and the service network itself must all be weighed when assessing a vehicle’s value.
This is why short test drives, spec-sheet comparisons, and brief reviews can rarely reveal a vehicle’s genuine long-term quality.
2. Major Events Comparison: 2024–2026
| Company / Brand | Major Developments | Long-Termism Observations |
|---|---|---|
| Geely | Consolidated Zeekr and Lynk & Co; invested in a major integrated safety testing center | Fosters continuous R&D and validation capabilities |
| Great Wall Motor | Advanced hybrid and off-road tech; expanded overseas local manufacturing | Solid foundation in vehicle engineering and production |
| Chery | Expanded global business; led traditional vehicle dependability rankings | Solid track record in manufacturing and quality management |
| NIO | Expanded battery-swap network; deepened partnership with CATL | Long-term investment in user infrastructure |
| XPeng | Partnered with Volkswagen on electronic/electrical architecture | In-house tech validated by external partners |
| BYD | Global expansion; supplier cost disputes; multiple safety recalls | Commercial competitiveness and product quality governance must be evaluated separately |
| Xiaomi | SU7 driver-assistance recall; serious collisions sparking safety debates | Fast-paced development tested against safety validation |
| Li Auto | Battery-related recall for the MEGA; strategic adjustments to pure-EV roadmap | Strong service capabilities, but critical engineering quality issues persist |
| AITO | Serious M7 collision; strong initial quality scores for M5 and M9 | Quality scores and safety accountability must be examined together |
| Luxeed | Early S7 delivery bottlenecks; deepened partnership between Huawei and Chery | Delivery and operational stability still need to be proven |
| Stelato | S9 and S9T entered luxury segment; faced complaints over NVH and assembly fit | Luxury refinement requires long-term validation |
| Maextro | Three V800 test vehicles experienced brake pedal bracket failures | A critical safety warning sign for structural components and testing protocols |
| Shangjie | Promoted smart tech democratization with H5; faced complaints over facelifts and buyer benefits | Focus on delivery quality and honoring commitments to owners |
| Leapmotor | Platform-based development; improved profitability; deepened ties with Stellantis | Cost efficiency shows promise; long-term durability remains to be seen |
| HiPhi / Neta / Jiyue | Production halts, bankruptcy, or severe operational crises | Failure to remain a going concern harms after-sales support and long-term owner rights |
The evidentiary nature of these developments must be kept distinct: regulatory recalls represent formal remediation of identified defects; independent media tests represent technical findings whose testing conditions and root causes require verification; owner complaints serve as investigative leads; and accident reports cannot be treated as proof of vehicle defect until official investigation conclusions are released.
3. Major Chinese Automakers: Cross-Comparison of Product Long-Termism
The following assessments do not award bonus points for market share, profitability, or brand premiums. Instead, they prioritize real-world quality performance, safety governance, after-sales service, and long-term owner rights for vehicles already delivered to customers.
| Company / Brand | Positive Evidence to Date | Primary Risks | Current Assessment |
|---|---|---|---|
| NIO | Initial quality scores for ET5/ET5T and ES8; leads luxury NEV service satisfaction; battery-swap network | Service operating costs; financial sustainability | Relatively strong evidence of long-term user value |
| Geely / Zeekr | Manufacturing experience; safety R&D investment; strong Zeekr service ratings | Quality consistency across multiple brands and platforms | Strong; requires verification on a model-by-model basis |
| Chery | Leads ICE dependability studies; extensive manufacturing and export experience | Varying maturity across its NEV sub-brands | Solid manufacturing and quality fundamentals |
| Great Wall Motor | Hybrid and off-road engineering track record; initial quality scores for Wey Lanshan | Long-term quality on new platforms; EV transition pressure | Strong; requires ongoing observation |
| Li Auto | Repeatedly leads mainstream NEV service satisfaction rankings | MEGA recall; shifts in product roadmap | Strong service network; questions remain around safety validation |
| XPeng | Tech platforms; in-house R&D capabilities; service satisfaction performance | Mechanical durability and long-term maintenance costs | Clear technical foundation; long-term quality still unproven |
| Xiaomi | Initial quality scores and owner sentiment for SU7 and YU7 | Driver-assistance recall; safety design controversies | Promising initial quality; safety maturity requires further validation |
| BYD | High-volume manufacturing scale; core electrification tech; leads initial quality in select models | Supply-chain governance; quality consistency across models; long-term repair experience | Strong commercial advantages; long-term quality edge not yet fully established |
| Leapmotor | Platform-based architecture; cost control; select independent safety test results | High-mileage reliability and after-sales service footprint | Strong growth potential; limited long-term evidence |
| SAIC / Changan | Deep foundations in vehicle manufacturing and supply chains | Wide portfolio of transitional brands with uneven quality performance | Must be evaluated by specific brand and platform |
Interim findings: Looking at delivered NEVs and service operations, brands like NIO, Li Auto, and Zeekr offer relatively direct third-party evidence of user satisfaction; looking at manufacturing heritage, Geely, Chery, and Great Wall Motor hold a clear edge.
Even so, these findings cannot be boiled down into an absolute, industry-wide quality ranking. Price segments, vehicle lifespans, sample sizes, and service models vary widely from one brand to the next.
Comparing the Five HIMA Brands
HIMA (Harmony Intelligent Mobility Alliance) is not a single brand with a unified vehicle manufacturing system; it is an ecosystem of products born from Huawei’s partnerships with different carmakers. Its five brands must be evaluated independently.
| Brand / Partner | Quality and Service Evidence | Primary Issues | Current Assessment |
|---|---|---|---|
| AITO / Seres | Initial quality leader in segments for M5 and M9; after-sales satisfaction score of 811 | Safety controversies following serious collisions; sustainability following division-of-labor adjustments | Relatively strong evidence of user experience |
| Luxeed / Chery | Initial quality leader in segment for R7 EV | Early S7 delivery bottlenecks; scattered complaints over service and assembly | Select models verified; overall system still maturing |
| Stelato / BAIC | Clear investments in cabin luxury and ride comfort | Complaints regarding NVH and interior rattles; limited long-term survey data | High-end refinement remains to be proven |
| Maextro / JAC | Investments in ultra-luxury tech and vehicle engineering | Brake pedal test failure on the V800 | Critical safety alert; requires formal investigation |
| Shangjie / SAIC | Democratizing smart tech; generally acceptable results in initial product-quality assessments for the H5 | Controversies over facelift owner perks; insufficient long-term reliability data | Long-term quality not yet proven |
Three points warrant particular emphasis:
AITO and Maextro must not be conflated. AITO has built a track record of strong quality and service survey results, whereas the safety issue that emerged in a critical component on the Maextro V800 demands an independent investigation. The two can neither share quality accolades nor trade defect liabilities.
Stelato must be held to a higher standard than ordinary spec-sheet competition. For a luxury vehicle, NVH, assembly precision, material durability, and first-time-fix rates in after-sales service are what define long-term quality. Owner complaints about rattles deserve scrutiny, though isolated cases do not prove a systemic defect.
Shangjie’s core test is whether cost efficiency can translate into lasting product value. Bringing Huawei’s tech stack to mainstream price brackets is a positive move, but low-price competition should never come at the expense of build quality or commitments made to existing owners.
Following the September 2026 operational adjustments to the AITO partnership, Seres assumed greater responsibility for product definition, sales, and service—further demonstrating that the operational boundaries of these five brands are not identical.
4. Independent Survey Data: Which Brands Have Real-World User Validation?
1. 2026 NEV customer service satisfaction
J.D. Power NEV-CSI (1,000-point scale):
| Luxury NEV Brands | Score | Mainstream NEV Brands | Score |
|---|---|---|---|
| NIO | 814 | Li Auto | 793 |
| AITO | 811 | Zeekr | 789 |
| Yangwang | 811 | XPeng | 787 |
These results show that several Chinese brands have built strong post-delivery customer service capabilities.
However, high service satisfaction does not directly prove a low defect rate, nor can it offset confirmed, major safety flaws.
2. Select initial quality segment leaders in 2026
The following models led their respective segments in J.D. Power studies; they do not represent a cross-segment unified ranking.
| Brand | Representative Models |
|---|---|
| NIO | ET5/ET5T, ES8 |
| AITO | M5 EREV, M9 EREV |
| Luxeed | R7 EV |
| Xiaomi | SU7, YU7 |
| Geely | Xingyuan, Galaxy Starshine 8 |
| Great Wall / Wey | Lanshan |
| Chery | Fulwin T9 |
These placements show that select models from Chinese brands are indeed delivering solid initial build quality.
However, because many of these NEVs have been on the market for a relatively short time, comprehensive, comparable reliability data covering five to ten years of ownership remains scarce.
3. Traditional manufacturing quality remains a useful benchmark
In the 2026 J.D. Power China Vehicle Dependability Study for ICE vehicles, domestic brands such as Chery and Geely posted top finishes.
These studies provide evidence of accumulated experience in traditional automotive manufacturing and quality management. However, they cannot be taken as direct proof that every NEV under the same corporate group matches that standard.
Newly minted sub-brands, clean-sheet EV platforms, and models heavily dependent on new supply chains must be independently verified on their own merits.
5. Three Structural Issues Deserving the Closest Attention
1. Advanced technology does not mean mature foundational engineering
The brake pedal test controversy on the Maextro V800, Xiaomi’s driver-assistance recall, and Li Auto’s thermal-management recall on the MEGA involve basic mechanical structure, software safety, and traction battery systems, respectively.
These incidents do not stem from the same defect, nor do they prove that these companies rely on the same flawed engineering processes.
Yet together, they illustrate an inescapable reality: No matter how sophisticated the smart tech may be, vehicle safety ultimately hinges on the reliability of every critical link in the vehicle system.
Tech talking points cannot substitute for safety validation.
2. A luxury price tag is not the same as luxury build quality
Hefty price tags, bigger screens, feature-packed cabins, and upscale materials can elevate showroom appeal, but they do not guarantee long-term assembly consistency, structural durability, or efficient repairs.
For HIMA brands spanning varied price tiers—AITO, Luxeed, Stelato, and Maextro—as well as premium NEV makers like Li Auto and Zeekr, genuine luxury quality must be demonstrated through:
- Stable NVH and body panel fit that hold up after years of real-world use;
- Mechanical and electronic systems that stay consistently reliable;
- Predictable repair costs and steady parts availability;
- Transparent investigations and prompt resolutions when issues arise.
The essence of a luxury vehicle should never be about masking foundational quality shortcomings behind complex features.
3. Commercial advantages can run counter to consumer interests
BYD’s cost control, Geely’s platform modularity, XPeng’s software development, Huawei’s technology reuse, and NIO’s battery-swap network can all create long-term value for consumers.
Yet all of them must pass the exact same test:
Has the automaker used these strengths to lower long-term ownership costs, improve quality consistency, and ensure future serviceability?
If commercial advantages are funneled primarily into margins, market share, and brand premiums without steadily improving the ownership experience, those capabilities demonstrate corporate competitiveness—not product long-termism.
6. A Framework for Evaluating Product Long-Termism
If we evaluate automakers strictly from the standpoint of consumer interests, I believe we should weigh criteria in the following order:
| Priority | Evaluation Dimension | Core Question |
|---|---|---|
| 1 | Safety and engineering validation | Does the automaker thoroughly validate critical structural, mechanical, and electronic systems, and proactively rectify defects? |
| 2 | Long-term reliability | Do the vehicle’s mechanical, material, and electronic systems remain stable after five to ten years of use? |
| 3 | Total cost of ownership | Beyond the sticker price, are repair, insurance, replacement parts, and ongoing maintenance costs reasonable? |
| 4 | After-sales and service continuity | Can the automaker reliably honor warranties, repairs, parts supply, and software support over time? |
| 5 | Transparency and accountability | Are quality issues disclosed honestly, and are owner rights respected? |
| 6 | Technical and commercial capability | Does the company possess the R&D capabilities and financial staying power required to back up the commitments above? |
Technical and commercial capabilities certainly matter, but their purpose is to support the first five priorities—not to serve as convenient stand-ins for product quality.
7. Overall Assessment
As of October 2026, the following interim conclusions can be drawn:
First, relatively strong evidence of positive user experience already exists.
Brands like NIO, AITO, Li Auto, and Zeekr show solid momentum in independent service and initial quality surveys; Chery, Geely, and Great Wall Motor also possess commendable foundations built on traditional manufacturing experience.
This demonstrates that China’s auto industry is not simply driven by marketing blitzes and price wars. Several players have built observable, long-term track records in product quality and customer support.
Second, technical competitiveness is strong, but long-term quality remains unproven.
Brands and product ecosystems including Xiaomi, XPeng, BYD, Leapmotor, Luxeed, Stelato, and Shangjie enjoy distinct technological, manufacturing, or market advantages.
Several models have achieved strong initial quality survey scores, yet data tracking their reliability and repair costs over extended ownership cycles remains sparse.
These companies should not be granted a clean bill of high quality simply because they are commercially successful, nor should they be written off as low quality simply because long-term data is still scarce.
Third, critical safety flaws and business disruptions require heightened vigilance.
The Maextro V800 pedal incident, the Li Auto MEGA recall, and Xiaomi’s driver-assistance recall must all be weighed when examining these brands’ long-term safety governance.
Meanwhile, operational crises at HiPhi, Neta, and Jiyue serve as a stark reminder that consumers must also bear the after-sales fallout when a carmaker fails to survive as a going concern.
These incidents differ in nature, but all touch on an automaker’s long-term responsibility for the products it puts on the road.
Conclusion: Those Left Standing Won’t All Be Good Automakers
The intense competition sweeping China’s NEV market since 2024 is laying bare the real differences in automakers’ business acumen, engineering discipline, and underlying values.
Growing sales, cutting costs, and turning a profit prove that a company has commercial muscle.
Consistently rolling out cutting-edge tech proves that a company has R&D and innovation chops.
Yet neither guarantees that the company is willing to bear the costs required to safeguard product safety, reliability, and ownership experience over the next five to ten years.
True product long-termism lives where the spotlight rarely shines—and where consumers rarely notice on day one: thorough engineering validation, prudent safety margins, durable components, a dependable service network, and the integrity to take ownership when things go wrong.
When the tide recedes, those left standing won’t all be good automakers.
The companies that prevail in the battle for capital and market share may not make the best cars; and vehicles with lower price tags and longer feature lists will not necessarily cost less to own over the long haul.
Surviving over the long term is a business achievement; delivering reliable, predictable value to consumers over the long term is the true mark of a great product.
Primary Sources and Limitations
Independent Reporting and Industry Research
- Reuters: Investigations into China’s auto price wars, supply-chain payment terms, recalls, and financial operations of major automakers (2024–2026).
- J.D. Power: 2024–2026 China New Energy Vehicle Initial Quality Study.
- J.D. Power: 2026 China Vehicle Dependability Study.
- J.D. Power: 2026 China New Energy Vehicle Customer Service Index Study.
- J.D. Power: 2026 China Brand Reputation Index.
- Euro NCAP: 2026 safety test results for relevant Chinese-brand vehicles.
- Caixin Global, CnEVPost: Reporting on HIMA partnership adjustments and brand operations.
Supplementary Chinese Sources
- State Administration for Market Regulation (SAMR) vehicle recall bulletins.
- 12365auto (CheZhiWang) vehicle complaint logs and new-vehicle initial quality reviews.
- Dongchedi track tests of the Maextro V800 braking system and corporate responses.
Evidentiary Boundaries
- Owner-reported problem counts include design and usability complaints; they are not equivalent to mechanical failure rates.
- Customer service satisfaction cannot substitute for evaluations of product reliability or safety.
- Unverified owner complaints serve solely as investigative leads and should not be used to infer systemic defects.
- Safety issues on a single model cannot be extrapolated automatically to an entire brand or joint venture partner.
- Most domestic NEVs still lack sufficient five-to-ten-year reliability data, precluding any definitive, comprehensive long-term quality ranking at this time.
- The corporate classifications in this brief represent interim assessments based on public evidence, not definitive predictions of future product quality.
Research Principle: Sales volumes do not prove quality; retail prices do not imply safety; technical novelty does not equal engineering reliability; and commercial success alone does not demonstrate product long-termism.