SAIC Motor Corp, China's top automaker, said on Thursday it will raise up to 10 billion yuan ($1.5 billion) through a share placement largely to shore up its own-brand cars and commercial vehicles to help secure its leading position in the world's largest auto market.
As wealth grows in the fast-expanding economy, many Chinese carmakers are looking to boost their profile to cater to an increasingly patriotic population who, if given the choice, prefer to buy quality local products.
SAIC, which operates car ventures with General Motors and Volkswagen, is virtually the only domestic player that has made some inroads into segments where Buick, Passat, Accord and Camry models prevail.
"SAIC has had some success in selling cars bearing its own brands. But it needs more input to broaden its portfolio, which still lacks SUVs and MPVs," said Lin Huaibin, an analyst with IHS Global Insight.
The maker of Roewe 550, a model popular among the young professional elite, aims to double sales of its own-brand cars to 180,000 units this year, rising further to 500,000 units in the foreseeable future.
To build on its success, SAIC needs more capacity and new models to further differentiate it from domestic rivals and narrow the gap with foreign auto makers, industry observers said.
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