China Auto News of the Week (Mar. 9 - Mar. 13, 2009)

China carmakers look to joint purchase of steel

Shanghai, March 13 (Gasgoo.com) Five Chinese automakers are planning to start joint procurement of steel materials and tires in an effort to cut their purchasing costs, Chinese newspaper China Automotive News reports.

The five homegrown automakers include Jianghuai Automobile Co, Geely Automobile Holdings, FAW Haima Motor Co, Great Wall Motor Co and Lifan Automobile Co. Executives of the automakers were reported to have hold talks on the matter at a recent conference in Beijing.

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Great Wall, Chrysler drop small-car JV plan

Shanghai, March 12 (Gasgoo.com) China's Great Wall Motor has terminated its small-car joint venture plan with Chrysler due to changed situations, said the Chinese car company's president Wang Fengying on Wednesday.

Ms. Wang said in an interview with China Business News that "due to the recent downturn in the global car market, both companies have gone through major changes since they entered into the agreement, and the market slump makes further steps difficult to take."

Chery to launch luxury Riich brand on Mar. 18

Shanghai, March 11 (Gasgoo.com) Chery Auto is set to release its luxury car brand Riich (Ruiqi) on March 18, with six models to go on sale in the high-end auto market, xinhuanet.com said today. The Chery Riich logo closely resembles that of Bentley.

In addition to the logo, the exterior of Chery Riich also has much in common with Bentley, especially featuring the renowned Bentley wing signature design for a dapper and refined look. This design is shared by other luxury brands as well, such as Chrysler and Aston Martin. In the middle of the Chery luxury-brand's wing-like logo is a letter "R" (of Riich), just as the "B" of Bentley.

SAIC-GM-Wuling Feb sales grow 48% y/y

Shanghai, March 11 (Gasgoo.com) SAIC-GM-Wuling Automobile Co, General Motors Corp.'s (GM) China commercial vehicle joint venture, sold 80,175 vehicles in February, up 48.4 percent from a year earlier, a sign that the Chinese government's industry stimulus policy is luring buyers back into showrooms.

In the first two months the venture achieved sales of 155,343 units, up 33 percent year on year. Sales of Chevrolet Spark reached 10,115 units in the two-month period, representing a year-on-year growth of 97 percent.

Geely seeking advice on possible bid for Volvo

Shanghai, March 10 (Gasgoo.com) China's largest private automaker Geely Holding Group Co. is once again rumored to buy Swedish carmaker Volvo, a unit of Ford Motor, Oriental Morning Post reported.

According to The Times, Geely Automobile has appointed NM Rothschild to advise on a possible bid for loss-making Volvo, which has been put up for sale by its ailing American parent Ford.

China Feb auto sales rise 25% to 827,600 units

March 10 (Bloomberg) -- China vehicle sales surged 25 percent in February, the first gain in four months, after the government cut taxes on some models, helping the country extend its lead as the world's largest auto market this year.

Sales of passenger cars, buses and trucks climbed to 827,600 units, the China Association of Automobile Manufacturers said today in Beijing. The tally in the first two months rose 2.7 percent to 1.56 million, compared with a 39 percent decline to 1.35 million in the U.S.

FAW VW to buy Chengdu FAW as 3rd VW plant

Shanghai, March 10 (Gasgoo.com) Yesterday, when FAW Group put up for sale its 100% stake in Chengdu FAW Co., Ltd. for 502.23 million yuan ($72.55 million), FAW VW, the group's subsidiary joint venture with Volkswagen AG, confirmed its decision to buy Chengdu FAW to make it VW China's third plant, Beijing Times reported today.  

Chengdu FAW Co., Ltd. was founded, first as China FAW (Chengdu) Co., Ltd., in the capital city of southwestern China's Sichuan province in October 2002, based on Sichuan Passenger Vehicle Factory. In 2005, Chengdu FAW became a wholly-funded subsidiary of FAW Group, or its Chengdu plant that started to produce FAW VW's Jetta sedans in July 2007. By February 29, 2009, the net assets of Chengdu FAW are evaluated at 481,905,000 yuan.

China Feb passenger car sales grow 33% y/y

Shanghai, March 9 (Gasgoo.com) China's passenger car sales in February grew 33% year-on-year, boosted by government incentives including lower purchase tax for small cars, an industry group said on Friday, according to Reuters.

A total of 607,984 passenger cars were sold last month, up from 456,901 in February 2008, data released by the China Passenger Car Association (CPCA) showed.

Beijing Auto to buy Fujian Motor, Chrysler

Shanghai, March 9 (Gasgoo.com) As an automaker listed by the Chinese government to become one of the country's auto giants, Beijing Automotive Industry Holding Corp (BAIC, or Beijing Auto) is expected to get Beijing city's financial support of 10 billion yuan ($1.47 billion) for acquisitions and restructuring and for own brand creation, said Economic Observer newspaper yesterday.