flanders-china chamber of commerce

Great Wall Motors enters British market

agx — Fri, 18 May 2012 02:37:14 +0000

Great Wall Motors Co, China’s biggest maker of sport utility vehicles (SUVs), introduced a compact pickup truck to the UK, becoming the first Chinese automotive brand to enter the British market. The Great Wall Wingle, rebranded the Steed for the British market, also became the cheapest pickup truck in the market. It is being sold in Britain by International Motors, whose Great Wall UK Director, Paul Hegarty, said the Steed’s key selling point is value. Offered nationwide through 40 appointed dealers, the vehicle comes in two versions: the Steed S for GBP14,000 and the Steed SE for GBP16,000. Hegarty said the vehicle’s value is shown in details such as Bluetooth connectivity, heated seats and a full leather interior. Great Wall exports vehicles wholly manufactured in China. Chinese car maker Geely will make a debut in Britain this year with the Emgrand EC7, to be sold through its British distributor Manganese Bronze Holdings. Great Wall, founded in Baoding, Hebei province, in 1976, has been China’s largest exporter of vehicles by volume and revenue since 1998. With a sales network covering more than 100 countries, Great Wall sold 85,000 vehicles abroad last year, up 50% year-on-year. About 120,000 Wingle pickups are sold in China each year, and 700,000 have been sold since it was introduced in 2006. Hegarty said the next step is to introduce a Great Wall SUV to the British market. Great Wall announced the opening of a factory in Bulgaria in partnership with the local company Litex Motors in February. The plant, aimed at supplying Eastern European markets, has a planned annual capacity of 50,000 cars, the China Daily reports.

Ford to invest USD760 million in China factory

agx — Fri, 18 May 2012 02:36:38 +0000

Ford will invest USD760 million to build a new plant in Hangzhou, Zhejiang province, as part of a drive to catch up with global rivals. Ford and joint venture partner Changan Ford Mazda Automobile would start construction later this year and the plant would open in 2015, initially producing 250,000 vehicles a year. The new plant will help the company double capacity to reach 1.2 million vehicles by 2015. Ford said the move is part of the company’s “largest expansion in 50 years”, aimed at boosting global sales by 50% from 2010 to about 8 million vehicles a year by mid-decade. Ford formed its first joint venture in China only just over a decade ago, while VW has been producing cars in China since the 1980s. GM and VW each produced more than 2 million vehicles in China last year. Ford also said it would invest USD600 million to expand capacity at its facility in Chongqing, the largest manufacturing base for the company outside its home in Michigan, U.S. The company said it would bring 15 new vehicles and 20 new powertrains to China by 2015, increasing the company’s relatively limited product range available in China. The latest investment brings Ford’s total investment in China to USD4.9 billion. Ford has less than 3% of the market.

Carmakers show models tailored for China market

agx — Fri, 18 May 2012 02:36:01 +0000

Ford Motor unveiled a three-cylinder mini-SUV, Lamborghini revealed its first sports utility vehicle in decades and Chrysler showed a dragon-theme Jeep, as carmakers introduced models designed for Chinese buyers at the Beijing Auto China 2012. Ford’s latest SUV, the scaled-down EcoSport with a one-liter engine, will be manufactured at Ford’s main China factory in Chongqing. Lamborghini Chief Executive Stephan Winkelmann said the company saw potential sales of 3,000 vehicles a year for the SUV. A final decision to produce the vehicle had not been made. Nissan, Toyota and other carmakers also used the event to show luxury cars and SUVs aimed at Chinese buyers. Chrysler said it would sell a dragon-themed Jeep, with golden accents and dragon designs on headrests and elsewhere. “To be successful in China, we must tailor our vehicles to the specific tastes of Chinese customers,” said Mike Manley, Chrysler’s COO for Asia. Japan’s Infiniti rolled out a new luxury car with a bigger back seat for Chinese businesspeople. Also on show was a display model of the first car from an electric-vehicle joint venture between Daimler and China’s BYD. “The products that we are building today globally have a lot more attention paid to what the customer needs in China,” said Kevin Wale, President of General Motors’ China unit. GM sells a Cadillac in China with a four-cylinder, two-liter engine to meet demand from local buyers for smaller engines, Wale said. “Nowhere else in the world would it have been done,” he said. Carmakers are targeting both ends of the market, with luxury models for newly rich urban Chinese and economy models for low-income earners. Jaguar Land Rover unveiled a Range Rover Evoque Special Edition four-seat coupe – co-designed by Victoria Beckham – with 20-inch gloss black forged-alloy wheels, rose-gold-plated accents and mohair mats.

Brose Group grabs opportunities in Chinese market

agx — Fri, 18 May 2012 02:35:23 +0000

German vehicle parts supplier Brose Group said that China’s new regulation governing antitrap features for car power windows offers an opportunity for the company to further develop in China, which will be its largest single-country market by 2015. “China already accounted for 18% of our global revenue in 2011. The country will definitely overtake North America to be our second-largest regional market, only behind Europe, and our biggest country market, by 2015,” said Thomas Spangler, President Asia and Member of the Executive Board of Brose Group. “Till then, revenue from China will contribute at least 20% of our global business.” The Chinese government’s new window regulation, which took effect on January 1, is similar to European technical standards requiring anti-trap technology with a maximum closing force of 100 Newtons for window regulators that have automatic “up” functions or remote control-window closing. As the inventor of anti-trap features for power window regulators, Brose supplies almost all international vehicle makers with 30 million electronic components annually, and 7.5 million of those are fitted in cars in China. It has five manufacturing bases in China. In 2011, the company’s revenue reached CNY5.4 billion in China, up 21% year-on-year. According to Spangler, Brose targets sales in China this year equivalent to €687 million. Manually cranked windows are becoming less common, as power window regulators have become almost standard for passenger vehicles, at least in mid-sized and larger cars. About 80% of all vehicles in China are equipped with power window regulators and the proportion is increasing. China’s new rule requires the window to stop and reverse if more than 100 Newtons of closing force is exerted. Without anti-trap features, forces of up to 400 Newtons are exerted, the China Daily reports.

Beijing Auto Expo breaks records

agx — Fri, 18 May 2012 02:34:34 +0000

When the first Beijing International Automotive Exhibition was held 22 years ago, 216 motor vehicles were on display, including motorcycles. This year a record-high 1,125 vehicles from carmakers were showcased. 36 vehicles made by foreign carmakers and 84 cars by domestic manufacturers made their global premieres. The exhibition closed on May 2. The total exhibition area was a record as well ― an all-time high of 230,000 square meters. Volkswagen Group booked an entire hall of more than 9,600 sq m to showcase models under its eight brands Volkswagen, Audi, Bentley, Bugatti, Lamborgini, SEAT, Skoda and Porsche. Thirty-one Volkswagen-branded models ― including the E-Bugster electric car, Cross Coupe and new Lavida making their global debuts in China ― were on display. Ford has promised to bring 15 new models to China before 2015. At the Beijing Auto Show it showed a rich lineup led by the all-new Focus and its three latest SUVs. Absent from the last Beijing Auto Show, Italian carmaker Fiat returned to the stage this year with the global debut of the Viaggio, the first model to be produced at its joint venture with Guangzhou Automobile Group. Anhui-based Chery Automobile Co showed 20 models at the auto show, including three models making their global premieres. The Cowin 5, Riich G2 and new Eastar, which augment Chery’s classic product portfolio of the Tiggo, QQ, A3 and G3, represent the carmaker’s increasing competitive strength. The company also showcased two new concept vehicles: the SUV TX and the energy concept @ant. BAIC Group, the partner of Daimler and Hyundai, debuted the first mid-sized sedan carrying its wholly owned Beijing marque. Almost all major car makers showed their SUVs at the exhibition. Domestic carmakers Geely and Chang’an launched their first-ever SUVs. In all, about 30 new SUV models are expected to join the marketplace this year to cash in on the booming segment.

Some 88 new-energy vehicles also appeared at the Beijing Auto Show. SAIC Motor displayed the Roewe 550 plug-in hybrid that will be put into volume production this year. The pure-electric Roewe E50 made its first public appearance. Victoria Beckham flew to Beijing to launch a limited edition Range Rover Evoque bearing her name with “ultra-luxurious” floor mats, a four-piece luggage set and tan seats. Seat, the VW-owned brand which faces a collapsed car market in Spain, dispatched its entire board to China during the exhibition, where they fanned out across several cities to attend dealership openings and launch the marque. VW says it is opening dealerships in China at the rate of two a week. BMW is adding at least one dealership a week there and will have 350 by the end of the year, the same number as in the U.S. Last year new car sales in China totaled 18.5 million units, retaining the country’s top position for the third consecutive year, but growth slowed to 2.5% from strong double-digit growth in 2009 and 2010. In the first quarter this year, the numbers actually fell as 1.25% fewer passenger vehicles were sold than in the same period last year, according to statistics from the China Association of Automobile Manufacturers (CAAM). The rest of the year is expected to be better. Industry consultancy IHS forecasts that passenger vehicle sales in China will increase about 8% this year and LMC Automotive projects 9% growth.

Volvo to expand offering in China

agx — Fri, 18 May 2012 02:33:58 +0000

Volvo Cars will launch 10 models in China over the next five years as it seeks to make up for lost time in the world’s largest car market, Chief Executive Stefan Jacoby said. The Swedish carmaker, which is owned by Chinese carmaker Geely, today offers six models in China and will add the new ones after opening two car plants and an engine plant in the country. “In the year 2017 we will offer 10 additional new models in the Chinese market,” Jacoby said at the Beijing auto show. Because some of the cars in Volvo’s line-up would be retired by then, the number of models offered would be less than 16, he said. The new models would mostly come from the brand’s global cars portfolio, but some would be tailored for the Chinese market. Volvo aims to open its first car plant in the second half of 2013 in Chengdu, which will make small and midsize cars. The plant’s first model will be an upper-midsize “C/D” segment car. A second plant making larger cars will be opened two years later in Daqing, Jacoby said. The company will also build an engine plant in Zhangjiakou, near Beijing.

Dealers report shrinking profits

agx — Fri, 18 May 2012 02:33:23 +0000

Carmakers were warned against over-expanding their capacities and dealerships as the number of dealers reporting shrinking profits or even losses was rising. Sinomach Automobile – the third largest dealer in China – told the Automotive News China conference in Beijing that carmakers were facing an imbalance between supply and demand. “We expect sales of imported cars to grow by about 20% to one million this year,” said Sun Yong, the company’s Deputy General Manager. “However, some carmakers forecast growth of up to 50% or even 70%.” A survey by JD Power and Associates of 1,605 dealers of 38 brands in 59 cities found the number of profitable dealers shrank to 63% last year from 81% in 2010, while 20% saw losses, against 9% previously. Sun expected profits to shrink this year. ADP Dealer Services, which provides management systems to the industry, said the average net profit of car dealers last year was about 5.2% but a “cold winter is coming”. James Press of McLarty Automotive Partners said apart from focusing on new sales, which used to make up to 40% of profits, dealers should expand their source of income by looking into options such as after-sales services or used car sales. Tan Peng-wei, Asia President of ADP, said manufacturers should provide more training to sales agents as the industry was still young and most agents focused only on selling new cars.

Luxury car sales still going strong

agx — Fri, 18 May 2012 02:32:51 +0000

China’s luxury vehicle sales surged 36.7% year-on-year in the first quarter to 130,416 units, according to a study by Morgan Stanley. The growth far beats the overall market’s 3.4% decline and the passenger vehicle segment’s 1.3% drop. China for the first time became BMW’s largest market. BMW’s first-quarter sales of 80,014 units showed a 36.8% growth year-on-year, while Audi reported total sales of 90,063 units, an increase of 40.5%. Mercedes-Benz also saw its sales surge 24% in China in the first three months of the year. The company expects China to be its biggest market by 2015. Moreover, “China plays an important role in our 2020 strategy of regaining the top position in the world in all categories before this decade is out,” said Joachim Schmidt, Executive Vice President of Sales and Marketing for Mercedes-Benz Cars. Statistics from Morgan Stanley show that luxury vehicles in the first quarter only occupied 4.1% of China’s total automobile market. Jia Xinguang, an independent Beijing-based Auto Analyst, said he believes the luxury vehicle sector in China will maintain high-speed growth over the next decade. Dan Akerson, Chairman and CEO of General Motors, announced that the company plans to bring two new Cadillac models to China, the XTS luxury sedan and ELR luxury electric coupe. The XTS will be manufactured and distributed in China by Shanghai GM. It will go on sale at Cadillac dealers nationwide in the fourth quarter of 2012. “China has quickly become the fastest-growing market for Cadillac. Last year, sales rose by 73%,” said Akerson. Luxury car sales jumped 22% in the first quarter of this year while passenger car sales dropped 3.4%.

Government pushing for Chinese brands

agx — Fri, 18 May 2012 02:32:15 +0000

Foreign carmakers in China say Beijing is putting pressure on them to produce dedicated new brands so their local partners can gain technical know-how, but experts warn the strategy could backfire. The government, keen to boost the local automotive industry, has long required foreign companies aiming to make cars in China to set up joint ventures with domestic manufacturers. In the past year, companies say they have also come under pressure from Beijing to launch brands specifically for the local market, even though there are no explicit rules requiring them to do so. “Many of our competitors that have not launched a dedicated brand have had the brakes put on their plans to develop manufacturing,” said Maxime Picat, Director General of Peugeot-Citroen’s joint venture in China. “We are putting together plans to launch our own brand, in line with what the government requires.” Picat said Beijing had been reviewing the 20 years since international auto partnerships were authorized. “There has been very little transfer [of technology],” he added. Experts say there is a danger that by helping their Chinese partners gain access to technology foreign manufacturers could end up creating more competition for themselves at home. General Motors was the first to fulfill the government’s desire, launching its Baojun brand a year ago in association with its partner Shanghai Automotive Industry Corporation (SAIC). Volvo also announced it was working on a new brand for the Chinese market, while Nissan launched three electric cars under the new Venucia name. “Foreign brands do not benefit from incentives, even if they are manufactured in China,” Nissan’s China Public Relations Manager Shen Li pointed out. Some foreign manufacturers, such as Ford, have so far held back from launching dedicated Chinese brands. Ford has just 2% of China’s passenger-car market. Intent to catch up, the second-largest U.S. carmaker is spending USD4.9 billion to build eight factories and launch 15 new models in China by 2015.

Luxury car makers open showrooms in inland cities

agx — Fri, 18 May 2012 02:31:35 +0000

Luxury car makers including Porsche, Maserati and Bentley Motors, are opening more and more showrooms in inland cities, from Ordos in Inner Mongolia to Changsha in Hunan province. “Major cities such as Shanghai, Beijing and Guangzhou powered the initial phase of the auto demand boom,” said Ashvin Chotai, Managing Director at industry researcher Intelligence Automotive Asia. “Expansion into the inner provinces and smaller cities is a natural aspect of the evolution of the car market and will be an ongoing process in the medium and long term.” While nationwide premium-car ownership in China lags behind the global 10% average by 2 percentage points, their share in eastern coastal provinces exceeds U.S. and European levels, Sanford Bernstein said. For example, luxury cars accounted for 24% of vehicles in Beijing in the first half of 2011, more than double the 11% U.S. average. Lamborghini, BMW’s Rolls Royce and Bentley already say their biggest market is China, where CapGemini and Bank of America estimate there are half a million millionaires with USD2.7 trillion in wealth. Ten of Porsche’s 12 best-performing dealerships globally are in China, the company said. Deliveries of cars priced beyond CNY2 million are set to grow 19% this year to 5,278, according to data from industry researcher IHS Automotive. By comparison, the China Association of Automobile Manufacturers (CAAM) predicts the total number of passenger vehicles will increase 9.5% in 2012.