China Auto News of the Week (Aug. 25 - Aug. 29, 2008)

Chinese going for gold in U.S. auto market

Fresh from challenging the U.S. in the Olympic medal count, China is planning a challenge in another competition Americans once dominated: the car dealership.

Edmunds Inside Line reports that Chinese automaker Brilliance has become the fifth Chinese automaker to sign a deal to display its wares at the Detroit Auto show in January.  The show is typically the U.S. auto industry's most important stage, where the Big Three roll out the cars they hope will dominate the U.S. market over the next year, as well as concept cars that preview what future vehicles may look like.  But the 2009 Detroit show will feature similar displays from Chinese automakers Chery, Geely, Changfeng, BYD and now Brilliance.

Motor Trend adds, "If all goes as planned…Brilliance will enter the U.S. market by as early as next year."  At the moment, "none of its cars pass American safety and emissions standards."  But Brilliance has partnerships with several automakers who are experienced in those areas.

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FAW to complete auto range with Mazda MPVs

FAW Car Corp, the partner of Japan's Mazda Motor Corp, on Friday announced it would invest 293 million yuan (US$43.2 million) to locally produce Mazda multi-purpose vehicles (MPV) to complete its product portfolio.

The listed unit of China's second-biggest car maker, FAW Group Corp, plans to make 20,000 Mazda-branded MPVs starting from next year after pouring money into new equipment and upgrading existing assembly lines in a plant in Changchun, it said in the latest filing to the Shenzhen stock market.

The move is expected to help FAW win more customers with a complete product line-up. It is now mainly partnered with Mazda to produce the Mazda 6 mid-to-high class sedan, which has been challenged by more competitive rivals such as Toyota's Camry and Honda's Accord.

Chrysler dropping out of Daimler's Beijing venture

Shanghai, August 25 (Gasgoo.com) Daimler and Chrysler have reached an agreement about their parting issue in Beijing Benz-DaimlerChrysler (BBDC), and Chrysler's personnel are gradually withdrawing from BBDC, reported First Financial Daily today. The three-way cooperation will be coming to later this year with Chrysler's dropping out.

Sources said that German car-maker Daimler AG has recently contacted Beijing Automotive Industry Holding Co. (Beijing Auto) to talk about the impact the split of Daimler and Chrysler will have on BBDC -- their joint venture with Beijing Auto, and meanwhile to explore a new means of cooperation with Beijing Benz. Reportedly, Daimler will invest an additional $1 billion in Beijing Benz as compensation for the withdrawal of Chrsyler.

Fiat builds tech cooperation with Guangzhou Auto

Shanghai, August 26 (Gasgoo.com)Fiat SpA has agreed to establish technical cooperation relationship with Guangzhou Auto, the Beijing News reported today, citing a senior official of Fiat China.

Under the condition of anonymity, the official said Fiat may expand its technical cooperation to a full fledged scale in future considering Guanghzou Auto's marketing and profit-making capacities, but it all depends on the progress of Fiat's talks with Chery.

Paolo Arpellino, chief representative of Fiat's China office, confirmed that no other project such as building a JV was discussed other than the technical cooperation program for the time being.

Dongfeng Nissan to export 900 cars to Egypt

Shanghai, August 26 (Gasgoo.com) Dongfeng Nissan Passenger Vehicle Company, a 50:50 joint venture between Nissan Motor Co and Dongfeng Motor Corp, will export 900 Nissan cars to Egypt starting next month, said sina.com yesterday.

The 900 Nissan passenger vehicles will include 400 Livina cars and 500 Sylphy cars, all of them were made at the joint venture's Huadu plant in southern China’s Guangdong province. Their first batch is scheduled to be shipped to Egypt in September, said Sharon Shen, a spokeswoman for Nissan China. These Chinese-made Nissan cars will be sold by Nissan dealers in Egypt.

Changan Ford Mazda cuts 2008 sales target by half

Shanghai, August 27 (Gasgoo.com) Mazda will lower its annual sales target in China to roughly 60,000 units from the previous goal of 120,000 units set earlier this year, announced  Changan Ford Mazda Automobile Co in the company’s mid-year business conference with 95 domestic Mazda dealers on August 27, reported 21st Century Business Herald today.

"We haven't ceased production," Mazda's Nanjing plant declined to tell further details. However, according to sources from Changan Ford Mazda Engine Co., the company began to halt part of production lines in July and will have ceased all production lines in August and September except for some maintenance technician's work.

Caterpillar to expand R&D, capacity in China

Shanghai, August 28 (Gasgoo.com) Caterpillar Inc. announced that it has planned to expand its China-based research and development operations. The company also planned to increase the capacity of Shandong Engineering Machinery (SEM).

Caterpillar has selected Wuxi city in Jiangsu province for multi-functional research and development center. The R&D facility, Caterpillar's third in China, will serve the company's ventures in China and the rest of the Asia Pacific, chief executive Jim Owens told reporters in Beijing. The Wuxi R&D center will focus on product and process development, validation, localization and technological training.

Chinese mini-car makers seek growth by export

Shanghai, August 29 (Gasgoo.com) China's leading makers of mini-cars are all looking to overseas markets for further growth, because the global market demands for Chinese mini vehicles are growing annually by more than 80,000 units, said China Business News today.

As China's largest maker of mini vehicles, SAIC-GM-Wuling set up an overseas sales division in 2007 as the warm-up for its global growth. In July 2008, the joint venture began exporting the Chevrolet N200 minivan to Peru. SAIC-GM-Wuling manufactures a range of Wuling brand mini-trucks and minivans as well as the Chevrolet Spark mini-car.

Changan Motor began to export its mini-cars to other countries in 1991 and since then it has never stopped exploring the global markets. The Chinese carmaker aims to built eight overseas production bases and sell 200,000 mini vehicles outside China by 2010. This global growth plan also includes launching eight major mini models, including four commercial car models.