China Auto News of the Week (Dec. 1 - Dec. 5, 2008)

China plans to relax controls on fuel prices as long as crude oil stays below $130 a barrel and ease curbs on refiners under a long-awaited reform plan, an official source familiar with the issue said on Friday.

The source confirmed a report in the official Shanghai Securities News, which quoted unnamed sources as saying that when crude was below $80 a barrel, refiners would be able to set fuel prices in line with crude. With crude between $80 and $130, they would have to accept reduced profit margins.

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Audi China to finish new assembly plant in Jan '09

Shanghai, December 1 (Gasgoo.com) German car manufacturer Audi's new assembly plant in Northeast China will officially start operation next March, stepping up its capacity in the fast-growing market amid growing competition, reported Beijing News on Monday.

Covering a land area of 81,610 square meters, the 1 billion ($146 million) plant will build Audi A4 and Q5 models after it starts operation next year, said An Tiecheng, General Manager of FAW-Volkswagen Automobile Co, a joint venture automaker between Volkswagen AG and China's FAW Group Corp.

Shanghai GM launches new Buick Regal today

Shanghai, December 1 (Gasgoo.com) Shanghai GM launched a new model of its self-developed brand the Buick Regal today. Along with the Buick LaCross released earlier this year, the new Regal, basically a badge-engineered Opel Insignia, is expected to capture the lion’s share of China's medium-grade auto market.

The launch of the Buick Regal in 2002 is seen as a landmark event on Shanghai GM's auto-making road. As a model specially designed for the Chinese market, the elegant, comfortable, luxury Regal has been well received by Chinese customers as a best-seller of the joint venture. It has been a model of Shanghai GM to rival Accord, Passat and often topped the sales list in the medium-grade car market in China.

Many Chinese automakers facing overcapacity

Shanghai, December 2 (Gasgoo.com) Many Chinese automakers are facing the problem of production overcapacity following aggressive expansions, a report from the Economic Observer showed Monday.

To quote some, Shanghai Automotive Industry Corporation (Group) (SAIC) launched its 150,000-unit-a-year Lingang facility recently, where its self-developed sedan Roewe 550, the next-generation Roewe 750, and some MG-branded car models are expected to be made.

Together with its production bases in Yizheng and Pukou, SAIC will boost its production capacity of proprietary brands to 400,000 units. However the Roewe sales for the first half of this year just stood at 8,244 vehicles and sales of MG-branded car models were only 3,661 units, both falling short of the sales projections.

Dongfeng Motor still rumored to buy GM

Shanghai, December 3 (Gasgoo.com) Dongfeng Motor Group Co., Ltd., a leading automaker in China, is seeking to acquire at least some assects of General Motors (GM) through contact with financial advisors close to the US auto giant, SinoCast reported today citing unnamed sources.

Hu Xindong, secretary to chairman of Dongfeng, declined to comment yesterday. But he earlier said the nation's third biggest car maker has been contacted by financial groups which have close relationships with GM over a possible takeover, according to National Business Daily.

China making of Volvo unaffected by brand sale

Shanghai, December 3 (Gasgoo.com) Source from Ford (China) Co and Volvo China said production of Volvo cars at Chongqing plant will not be affected by the possible sale of the brand by its US parent.

Volvo Car's Chinese partner, Changan Ford Mazda Automobile (CFMA) will start production of Volvo S80 next year, and this plan is unlikely to be affected by the change, Volvo China stated.

CFMA currently makes the Volvo S40 at its Chongqing plant in Southwest China. Sales of the China-made car model reached 3,181 units in the Chinese market in the first half of 2008, inching up by 1.4 percent year on year.

More Chinese to buy German cars if US Big 3 fall

Shanghai, December 4 (Gasgoo.com) More than 50% of Chinese consumers will choose to buy a German brand car if the US' "big-three" automakers - GM, Ford and Chrysler, do fall, a survey shows.

Of 6,442 Chinese consumers who take the survey conducted by the Beijing Youth Daily and Souhu.com, 56.42% of them say they will not buy a US brand car if the Big Three giants go into bankruptcy.

Planner says Jan 1 best date to start fuel reform

Shanghai, December 5 (Gasgoo.com) Jan. 1 would be a good date to start reforms of China's fuel taxation and pricing system, a top Chinese economic planning official said on Thursday, according to a Reuters report.

"I personally think Jan. 1 is the best date," Zhang Xiaoqiang, deputy head of the National Development and Reform Commission, told reporters, adding that details of the planned reform would be unveiled within a few days.