Siemens Home Appliances Lost in China Market

"Domestic home appliance brands are on the rise, and the gap between foreign brands and Chinese local brands is narrowing. In areas like production, manufacturing, R&D, services, channels, and terminals, foreign brands no longer enjoy significant advantages. Consumer preference for foreign brands has waned, leading to a gradual decline in the reputation of Siemens home appliances in the Chinese market. When visiting an appliance store in Chaoyang District, Beijing, I noticed that domestic brands like Haier outsell 'foreign brands' such as Siemens. A staff member at the store mentioned that Siemens appliances are not entirely imported; they are joint venture brands assembled in Nanjing using German technology. This assembly process has raised concerns about potential quality issues. Recently, a range hood model produced by Bo Xihua Electric (Jiangsu) Co., Ltd., the Siemens CXW-220-C35S956, was found to have issues with total pressure efficiency, as reported by the Ministry of Commerce and Industry of Qinghai Province. Industry observer Hong Shibin noted that with the rise of domestic brands, the distinction in brand recognition between foreign and local brands is fading. Foreign brands no longer dominate in terms of investment, production, R&D, services, channels, or terminals, causing consumer interest in these brands to diminish. Consequently, Siemens home appliances are losing ground in the Chinese market. Siemens appliances have lost favor among consumers. During a visit to a large appliance store in Chaoyang District on July 17, I observed that the store primarily stocked Siemens refrigerators, washing machines, and range hoods. Refrigerator prices ranged from 4,500 to 16,000 yuan, while washing machines fell between 3,000 to 14,000 yuan. Store staff confirmed that lower-priced Siemens washing machines start at 2,000 yuan, yet these prices can now purchase premium domestic brands. A staff member named Cui Xing suggested, "It's better to buy domestic Haier appliances—more cost-effective, better service, and stronger after-sales protection." He also noted that the number of Siemens appliances sold is significantly lower than Haier's. Another staff member, surnamed Luo, agreed, stating that foreign brands like Bosch, Siemens, and Panasonic are now being replaced by domestic brands such as Haier, Midea, and Rongsheng. She emphasized that domestic brands offer superior after-sales support compared to foreign and joint venture brands. While browsing the JD app, I encountered several Siemens refrigerators with issues such as loud fan sounds, excessive operating noise, and compressor-related noise. Some consumers described the various noises produced during the refrigerator's operation: "Standby power consumption of about 6W produces no noise; normal operation at 40W to 65W is barely audible during the day; full operation at around 150W is extremely loud, accompanied by a strange liquid flow sound." Repeatedly appearing on quality blacklists: In recent years, Siemens refrigerators have faced consumer criticism. As early as 2011, Luo Yonghao, founder of Smartisan Tech, expressed frustration with three Siemens refrigerators at the company's Beijing headquarters due to difficulty closing the doors. Further investigation revealed that not just Siemens refrigerators have faced scrutiny. In June 2017, the Jiangsu Provincial Administration for Industry and Commerce listed lamps sold by Ouborui Lighting Operation Department of Siemens, Haimen City, as failing quality inspections for insulation, creepage distance, clearance of category II lamps, electric shock protection, electrical strength tests, and power terminal disturbance voltage. In May 2017, the Ministry of Commerce and Industry of Qinghai Province reported that Siemens CXW-220-C35S956 range hoods failed in total pressure efficiency inspections. Additionally, Siemens built-in cookers were unable to properly fit stove tops, prompting the company to respond with planned product upgrades based on user complaints. Industry observer Liang Zhenpeng commented to the media that multinational corporations often implement lower quality standards in the Chinese market compared to those in Europe, America, and Japan. However, these quality issues can be easily identified through inspections conducted by China's quality supervision and industry authorities. "Siemens employs a low-price strategy in the Chinese market, which inevitably compromises product quality," Liang Zhenpeng noted. Regarding the recurring quality and after-sales issues, the Legal Weekend reporter reached out to Siemens (China) Co., Ltd. for comment. They replied, "Siemens-branded home appliances are manufactured, marketed, and sold by Bosch Home Appliances. Siemens sold its shares of Bosch Home Appliances to Bosch. Currently, Bosch Home Appliances is 100% owned by Bosch, operates independently, and handles sales and after-sales services. Siemens does not participate in daily management." On July 18, Bosch's PR company in China responded to the Legal Weekend reporter: "The Chinese market is one of the key markets for Siemens home appliances worldwide. Siemens home appliance products comply with relevant Chinese product quality laws and regulations. Siemens Home Appliances offers product warranty policies, feedback systems, and follow-up visits to ensure customer service quality." Under attack from domestic brands: Public records show that the Siemens home appliance brand entered China in 1994 and is a significant part of the company. The Bosch Siemens Home Appliances Group was established in 1967 as a joint venture between Siemens AG and Robert Bosch GmbH, each holding 50% of the shares. Siemens Home Appliances products are independently manufactured and sold by Bosch Home Appliances, which also provides after-sales services. Siemens, as an investor, does not participate in operations. In January 2015, the Bosch Group acquired the remaining 50% stake from Siemens Group. Bosch Home Appliances became a wholly-owned subsidiary of the Bosch Group. However, Bosch retained the Siemens Home Appliances brand, channels, and market. The BSH Group remains a licensee of the Siemens trademark. When asked why Bosch Appliances wanted to keep the Siemens home appliance brand, the aforementioned CUI staff told the Legal Weekend reporter: "Since the core technology is still Siemens', the zero-temperature preservation technology for Siemens refrigerators is exclusive to Siemens, and Bosch does not receive this technology. Therefore, Bosch Home Appliances must continue using the Siemens brand." The Legal Weekend reporter noticed that an industry observer named Yu Kong questioned whether Bosch Home Appliances was sacrificing the Siemens brand image to maximize market share and compete in the low-end market. This has led to inconsistent pricing for Siemens appliances across different regions due to varying merchants, channels, and e-commerce vendors. After Bosch acquired Siemens Home Appliances, why is the development strategy being questioned? What is the direction of Bosch's home appliance business? "The team and strategy of Bosch Appliances serving Siemens have remained unchanged, whether before or after the acquisition," the company's PR firm in China replied. According to industry observer Liu Buchen, Siemens' home appliances in the Chinese market have been lukewarm over the past few years, neither experiencing significant growth nor major declines. "Siemens' underwhelming performance in the Chinese market is not surprising. It is the inevitable result of the continuous rise of local home appliance companies in China," said Liu Buchen, a reporter for the Legal Weekend. Based on his analysis, firstly, due to the environmental impact of European and American household appliances in the Chinese market, the global home appliance industry has undergone three major shifts over the years. In the early days, European and American appliances dominated the world. From the 1980s to the turn of the century, Japanese appliances led the market. Since then, China and South Korea have risen in the home appliance industry, causing Europe, America, and Japan to decline; secondly, the home appliance industry is not considered a highly sophisticated industry, and its profits are relatively low, making it less attractive to developed countries with higher labor costs. Developed countries have withdrawn; once again, as the world's largest home appliance consumer market, foreign brands have only enjoyed a decade of glory in China before their market position began to decline. Bosch and Siemens are also hard-pressed to reverse this trend. "Foreign brands face two major challenges in the Chinese market: First, they face competition from local home appliance brands. Foreign brands no longer have the advantages of high quality and low price, and consumers have a high degree of acceptance. Second, foreign brand products do not lead in manufacturing and R&D compared to domestic brands, and in terms of services, channels, and terminals, they are not better than local brands. Thus, foreign brands no longer hold high value in the minds of consumers," added Hong Shibin. "Siemens home appliances in China have limited opportunities for development and may retain only a small market share before gradually withdrawing from the home appliance sector," Hong Shibin predicted."

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