Short news automotive
May-30-2013 By : agxadmin
- U.S. company Coda Holdings recently filed for bankruptcy protection as it finalizes plans to exit the auto sector and refocus its business in energy storage. Its four-door, five-seat car was built by China’s Hafei, a subsidiary of Chang’an Automobile Group, and the battery was developed by Coda’s local joint venture with Tianjin Lishen Battery Co. Last year, Coda also agreed with China’s Great Wall Motors to co-develop its second product. Analysts said that agreement is expected to lapse as the California company exits the auto industry. Last year only about 13,000 hybrid and electric vehicles were sold in China.
- Ferrari expects the Greater China market plus the Far East region to contribute 2% more turnover in the next five years. By 2017, China will contribute 30% of turnover, up from the current 28%. In 2012, Ferrari sold 784 cars in its Greater China market, a 4% rise, reinforcing the market as its second largest after the U.S. Ferrari has 27 dealerships in the Greater China region, and plans to have 30 by the end of 2013, with three being added on the mainland.
- BWM has set up a third dealer staff training center in Guangzhou, following the existing ones in Beijing and Shanghai. The number of BMW dealer outlets in China is likely to reach 420 by the end of this year, employing about 43,000 staff. Karsten Engel, President and CEO of BMW Group Region China, said that the company needs “professional, experienced and dedicated people” to deliver high-quality services that live up to the expectations of customers. “The days of super-fast growth in China’s premium market are over. The key topic of tomorrow is quality,” he added. In April, Mercedes-Benz also opened a new training center in China, the sixth in the country.
- Shanghai reduced the supply of car plates to 9,000 and lowered the price ceiling designed to curb soaring plate prices to CNY79,900 at the May 25 auction. Bids exceeding that price were rejected by the online auction system in the first round of bidding. The average successful bid for a Shanghai car plate fell to CNY80,803, down CNY3,298 from last month, while the lowest price shed CNY3,200 to CNY80,700, according to the Shanghai International Commodity Auction Co. The atmosphere at the auction was less tense than usual. The number of bidders dropped by 3,950 to 22,224. Next month, the upward price limit for the first round of bidding will be set at CNY77,300, down CNY2,600 from this month’s maximum.
- Korean automakers Hyundai and Kia will recall more than 175,000 cars due to defective brake light switches, the General Administration of Quality Supervision, Inspection and Quarantine (GAQSIQ) said in a statement. Beijing Hyundai Motor Co will recall 121,835 of its IX35 models manufactured between April 9, 2010, and October 6, 2011, while Dongfeng Yueda Kia, a joint venture of Kia with two Chinese companies, is recalling 53,897 of its Sportage vehicles made between July 8, 2010, and October 15, 2011.
- Audi posted the fastest pace of sales growth among German luxury brands in China in April. Volkswagen-owned Audi deliveries rose 13% to 38,710 vehicles in the mainland and Hong Kong in April. BMW reported an 11% gain to 30,311 units on the mainland. Mercedes-Benz said sales increased 11% to 16,241 units on the mainland and Hong Kong. On the mainland, Audi cornered 29.6% of the market, BMW had 23.6%, while Mercedes-Benz took 20.6% in 2012, according to researcher IHS Global Insight.
- BYD rolled out Hong Kong’s first electric taxi fleet. The Hong Kong Taxi & Public Light Bus Association said it is renting from BYD an initial fleet of 45 taxis for HKD8,000 each per month, although only six vehicles had licenses so far. “We expect to increase the number of e6 taxis in Hong Kong to 5,000 in three years,” said Liu Xueliang, General Manager of BYD Asia Pacific sales.
- Sales of light vehicles including cars and light commercial vehicles in China will total 34.6 million units in 2020, double the figure in the U.S., according to a recent projection by Finbarr O’Neil, President of consulting company JD Power. He said China’s light vehicle sales are expected to reach 19 million units by the end of the year.
- China Grand Auto topped the ranking of the 100 biggest auto dealer groups in China last year with revenue of CNY72.6 billion, according to a recent report by the Automobile Dealers Association. Sinomach Automobile Co, with more than CNY62 billion in revenues, claimed the second spot. Shanghai-listed Pang Da Automobile Trade Co fell to third place with a revenue of CNY57.8 billion.
- Chinese manufacturer of special-purpose vehicles Tri-Ring Group may buy Polish bearings maker FLT Krasnik for about USD95 million in the largest investment yet by a Chinese firm in Poland.
- Dongfeng Motor Corp will inject capital into Fujian Motor Industry Group Co in exchange for an undisclosed stake from the Fujian provincial government. “This is part of the ongoing process for industry consolidation, we should be expecting more deals in the coming years,” said Lin Huaibin, Shanghai-based Analyst at IHS Automotive. Dongfeng, which produces Nissan’s Teana sedan, Honda Motor’s CR-V SUV and Citroen’s C5 sedan at its plants in China, is seeking to boost sales of its self-developed brands.
- Prices of imported cars in China fell the most in five months in April, by 3.4% from a year earlier, according to the National Development and Reform Commission (NDRC). That compares with the 0.2% increase for locally-made passenger vehicles.
- All 15 E150EV electric cars produced by the Beijing Automotive Group have been booked within three days of the Beijing launch of a pioneering rental project aimed at promoting the private use of e-vehicles. Based at Tsinghua University’s Science Park in Haidian district, the project was initiated by the Beijing Municipal Commission of Science and Technology. Most customers were people working in the park, where lots of high-tech enterprises are based. Customers can rent the electric cars by the hour, day or month. The cars cost CNY49 for two hours, CNY99 per day and CNY1,999 a month. It costs less than CNY19 to fully charge a car, which will then run for 120 kilometers.
- Brilliance China Automotive Holdings said it was likely to exceed its sales growth target of 25% for this year, but analysts said the carmaker’s new clean-energy-vehicle project and a product upgrade by rival Mercedes-Benz could pressure short-term profit. Sales jumped 25% year-on-year to 67,000 cars during the first four months of the year. It also forecast that by the end of the year sales could exceed its target of 200,000 units.
- Guangzhou Automobile Group announced that it plans to invest CNY1.7 billion to double the production capacity of its wholly-owned passenger car unit to 200,000 vehicles a year. The company also said it will invest another CNY1.15 billion in product development of the Trumpchi, its own passenger car brand.
- Beijing plans to have 50,000 electric vehicles on the roads by 2015, of which 30,000 will be private cars. The plan calls for 8,000 alternative-energy buses as well as 10,000 green taxis and government cars in the city by that time.
- Continental Tires opened its 13th BestDrive flagship store in China on May 16. The new facility in Wuhan, Hubei province is also the company’s 2,900th franchised store in the country. The company plans to aggressively expand its retail network in China this year by adding a total of 1,000 new authorized stores, or approximately three each day.
- Chinese car brands reported strong sales growth in the first fourth months in Russia. Great Wall Motors sold nearly 7,000 vehicles from January to April, up 85.5% from a year earlier. Geely ranked second, with more than 6,500 units delivered in the same period, up 64.4% from a year earlier. Lifan and Chery followed, both reporting sales of more than 6,000 units.
- China’s auto sales may start to go flat as early as 2015, with the trend remaining for 10 years, amid an infrastructure bottleneck and doubts on the ability of potential buyers in rural areas to afford a vehicle, UBS Securities predicted. In the past decade, China’s auto industry has grown by a 20% compound annual rate.
- Red Flag cars went on sale to the public on May 30 after a USD300 million overhaul, competing against Audi and BMW in the elite segment. FAW Group has already delivered more than 500 Red Flags to government agencies. FAW made about 1,500 Red Flag cars, reserved for high-ranking government and party officials, in the 24 years before the brand was discontinued in 1982 for having excessive fuel consumption. The brand has now been revived.
Gold-hungry China braces for surge in imports
By : agxadmin
Chinese gold imports are likely to swell further after rising strongly for a second straight month in May after prices plunged to a two-year low in April. “Consumers and industrial users tend to see price drops as buying opportunities,” Zhang Bingnan, Secretary General of the China Gold Association, said. “Investment demand should continue to stay strong through the rest of the year because of limited investment alternatives,” said Zhang, adding that gold sales and processing volumes both spiked in April. He said China’s gold consumption in the first quarter probably rose 10% to 15% from 255.2 tons last year. Net gold flows from Hong Kong to China, the world’s number two gold consumer after India, rose to 223.519 tons in March from 97.106 tons in February, data from the Hong Kong Census and Statistics Department showed. Demand for gold from India and China is a major factor in global prices, with the World Gold Council saying the two countries account for more than a third of global demand. China produced 403 tons of gold last year, but consumption was more than double at 832.2 tons. Gold tumbled to around USD1,321 an ounce on April 16, its lowest in more than two years. The drop in gold prices has prompted a gold rush in China, with Chinese shoppers flocking to retailers to buy jewelry and gold bars. A Spokesman for Hong Kong jewelry chain Chow Tai Fook, the world’s largest jewelry retailer by market value, said that traffic at its China stores jumped by 50% during the May Day holidays. Total gold sales in Hong Kong reached about 40 tons during the April 29-May 2 holiday. Gold exports to China from Hong Kong hit an all time high of 557.478 tons last year, the South China Morning Post reports.
Steel industry’s profit margin drops further
By : agxadmin
The profit margin of China’s steel industry dropped to 0.9%, delivering industry profits of CNY2.5 billion, in the first quarter. Thirty of the country’s 86 large and medium-scale steel companies reported losses in the first quarter, five fewer than in the same period last year, according to the China Iron and Steel Association (CISA). The loss-making companies reported a total loss of CNY6.1 billion during the period, against losses of CNY9.4 billion at the same stage in 2012. During the quarter, the inventories of the 86 large and medium-scale steel companies reached CNY583.1 billion, CNY10.2 billion higher than in the same period last year, which puts increased pressure on their sales and marketing operations to clear the growing stockpiles. According to the Association, the total debts of the 86 major steel companies had reached CNY2.98 trillion by the end of March, CNY188.9 billion more than at the same period last year. The debt-to-asset ratio of the industry has reached about 70%. Losses are likely to continue in April and May as the price of steel keeps on falling to its lowest level in five years, with some major producers having to adjust their product prices to maintain or boost market share. “The steel price adjustments being made by major producers reflect an ongoing weak market,” said Lu Huaying, Steel Industry Analyst with price monitoring service Lange Steel Information Research Center. Over the past year, China’s major steel companies – which account for 80% of the country’s total output – have recorded overall profits of CNY1.58 billion, a 98.22% year-on-year drop. Up to 23 of CISA’s major member companies reported annual losses last year, 15 more than the previous year, the China Daily reports.
Baosteel starts construction on blast furnace in Zhanjiang
By : agxadmin
Baosteel Group Corp has started piling work for the No 1 blast furnace of its Guangdong-based Zhanjiang plant, as part of the project to cut 30% of its capacity in Shanghai. The furnace will become operational by the end of 2015. Construction on a second furnace will start in June next year and be completed in 2016. The building of the other main units, including steel making, hot rolling and cold rolling facilities, will begin between July and September this year. Shanghai-based Baosteel sees the 10 million-ton-a-year Zhanjiang project as a “key battlefield” for its “second pioneering”, part of the company’s master plan to cut 30% of its capacity in the city over five years. It is also moving operations to Xinjiang where it has acquired a local steel company. Baosteel said it has done a “reexamination and restudy” of the production process, management model and investment control at the Zhanjiang project since May last year when a ground-breaking ceremony was held.
Baoshan Iron and Steel Co has reduced June prices for main products, its first cut in nine months, amid weak demand as economic recovery slows. The company cut hot-rolled steel prices for June delivery by CNY180 per ton and cold-rolled steel prices by CNY150 per ton. Baosteel’s pricing policy usually sets the tone for the rest of the market in China. Wang Bei of Mysteel Research Institute wrote in a note that while Baosteel and Wuhan Iron & Steel Co have room to cut June prices, other major mills like Angang Steel Co may maintain prices because they had unveiled price cuts for previous months.
Short news metals
By : agxadmin
- Shanxi Taihang Mining Co will become China’s first to use coke oven gas as an alternative to natural gas. It signed a contract with Mines and Metals Engineering, owned by the Iranian government and based in Dusseldorf, Germany. Shanxi Taihang Mining will use world-leading processing technology and equipment to lift its iron productivity and reduce emissions. The direct-reduced iron process can raise the purity of iron to 98%. Traditional blast furnace iron-making, which generates 80% of China’s total iron and steel output, however, only results in an iron purity of 60% to 70%.
- Steel products inventories in 26 monitored cities increased by 84.57% in the first quarter, compared with the beginning of this year, the National Development and Reform Commission (NDRC) said in a statement. The fundamentals for demand growth are positive as relevant industries such as automobiles and appliances are on track to maintain modest growth this year, but it would be difficult to improve steel enterprises’ profit margins due to their large capacity and high costs, it said.
- Trading in gold using the yuan has tripled in Hong Kong this year as the currency’s rally to a 19-year high helps limit risks for jewelers. The average daily volume was CNY6.5 billion so far this year, compared with CNY1.8 billion for the same period last year, according to the Chinese Gold & Silver Exchange Society.
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