SGMW’s quality issues broke out with its high sales volume. Official data shows that SGMW has a total sales volume exceeding 2m units in 2015, the first among all self-independent brands. SGMW’s excellent performance is highly related to its low-price strategy. The RMB 69,800 starting selling price is lower than similar products, but quality issues along with it also broke out at the same time.
Since 2010 when SGMW entered into the passenger vehicle market, Wuling Hongguang, Baojun 730, Baojun 650 and other models had surprised the market with their high monthly sales volumes. In 2015, SGMW sold 1.18m units passenger vehicles, accounting for 58% of total sales and increasing 26.72%. SGMW sold 195,000 units’ vehicles this October, increasing 13.8%. Baojun brand has a total sales volume of 87,000 units and increases 60%. SGMW MPV models sold 105,000 units, accounting for 54.2% of total sales volume. Baojun 730 sold 31,000 units in October. In the meantime, SGMW also puts great efforts in alternative energy vehicle market and foreign market. Its alternative energy vehicle plant, which has been invested RMB 3b, is expected to be constructed this year with an annual capacity of 200,000 units. The SGMW Indonesia Company is expected to be constructed in 2017, with an annual capacity of 150,000 units, which will manufacture, sell Wuling MPV and other products to Indonesia and other ASEAN countries.
At the same time, SGMW’s hot-selling passenger vehicles Baojun 730 and Baojun 560 are suffering high-density quality complaints. Data shows that complaints towards Baojun series products include rusting vehicles, engine noise and steering gearbox problems, arousing market’s suspicion on SGMW’s engine manufacturing abilities. It’s learned that the 1.8L engines, equipped by current Baojun series products, are made from Liuzhou Wuling Power Motion Limited Company, typed as LJ479QNE2.
