China Auto News of the Week (May 18 - May 22, 2009)

Shanghai, May 22 (Gasgoo.com) Following Guangzhou Automobile's merger with Hunan Changfeng Motor Co on Thursday, Chery Automobile Co and Anhui Jianghuai Automobile Co may become the next couple of companies to form a similar alliance in response to the government's call for creating competitive automobile giants, the Nanfang Daily reported.

Starting Thursday, Chery and Jianghuai jointly started a road show in China's western areas, including Chengdu, Guiyang and Tibet, to promote brand sales in the region. But Chery spokesman Jin Yibo said the show is simply a marketing programme, which does not mean any cooperation or merger plan between the two companies has been started.

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GM may get 4th bid for Opel from Chinese bidder

General Motors Corp. may get a fourth offer for its Opel and Vauxhall European operations after a Chinese carmaker submitted an expression of interest today, according to two people familiar with the matter.

The Chinese company sent a letter a day after yesterday's deadline for bids, said the people, who declined to be identified because the negotiations are private. A specific offer may not materialize, said the people, declining to name the company.

Fiat, Guangzhou Auto agree on car venture

Fiat has signed an agreement to set up a car manufacturing venture with China's Guangzhou Automobile Industry Group, the Shanghai Securities News said on Friday, citing the Chinese automaker's general manager.

Zeng Qinghong did not disclose the size of the venture, which is still pending government approval.

Beijing Auto Jan-Apr sales up 21% to 366,000 units

Shanghai, May 21 (Gasgoo.com) Chinese automaker Beijing Automotive Industry Corp said yesterday that in the first four months the company produced 370,000 vehicles, up 20.6% year on year (y/y) and sold 366,000 units, up 21.5% y/y, xinhuanet.com reported. Its sedan sales rose 52% y/y, keeping rapid growth for four straight months.

Beijing Auto saw double growth in sales and profits last month. In the Jan-April period, the company achieved sale revenue of 31.54 billion yuan ($4.62 bln), up 12% y/y, and total profits of 1.34 billion yuan, up 56.3% y/y.

Guangzhou Auto buys 29% of Changfeng Motor

Shanghai, May 21 (Gasgoo.com) China's Guangzhou Automobile has signed an agreement on Thursday afternoon to take a 29 percent stake in Hunan Changfeng Motor Co, which makes Guangzhou Auto the largest shareholder of the sport utility vehicle (SUV) specialist, according to sina.com.

Under the agreement, Hunan Changfeng Motor Co's company name will be changed to Guangqi Changfeng Holding Co. Ltd. Changfeng will hold 21.98 percent stake in the new company, while Mitsubishi Motors will remain Guangqi Changfeng's third largest shareholder with a 14.6 percent stake.

China builds auto R&D giant base in Tianjin

Shanghai, May 20 (Gasgoo.com) China Automotive Technology and Research Center (CATARC) broke ground for its new campus in Tianjin on May 19, to build the largest base of auto R&D in China, xinhuanet.com said today.

The project is located at Dongli Economic Development Zone of Tianjin city's Coastal New Area, about 120 km southeast of Beijing, and has an estimated investment of 1.2 billion yuan ($175.7 mln).

Dongfeng Visteon setting up new plant in Wuhan

Shanghai, May 20 (Gasgoo.com) Dongfeng Visteon Automotive Trim Systems (Dongfeng Visteon), a joint venture between leading auto parts supplier Visteon, Yanfeng Visteon and Dongfeng Group, broke ground recently for a new manufacturing plant in Wuhan, Xinhua news agency reported.

The plant will manufacture high-quality interior and exterior components for cars and trucks. After completion of the new plant's construction, Dongfeng Visteon will be able to supply to 300,000 complete vehicles units a year.

BYD chairman sells shares to overseas investors

Shanghai, May 20 (Gasgoo.com) Chinese battery and auto maker BYD Co. said that its chairman and president Wang Chuanfu has sold some of his shares to overseas investors, as requested by the country's stock regulator, the 21st Century Business Herald  reported.

Wang sold the equivalent of 0.55% of the company to long-term overseas shareholders, a spokesman for BYD Auto told the media yesterday, adding that Wang sold his shares at the request of the China Securities Regulatory Commission, but as the founder of BYD he is still holding HK$570 million of the company's stock.

Geely sells $99M in shares to fund acquisitions

Geely Automobile Holdings (0175.HK) said on Wednesday it would sell HK$769.5 million ($98.7 million) worth of new shares to its controlling shareholder, raising capital to fund acquisitions and for working capital.

The Chinese carmaker said it would sell 570 million new shares at HK$1.35 each to Proper Glory Holding Inc after the controlling shareholder completed sales of 800 million existing Geely shares at the same price to third-party investors.

Ford to build 3rd China plant in Chongqing

Shanghai, May 19 (Gasgoo.com) Ford Motor Co has given the go-ahead for the plan to build a third assembly plant in China to meet fast-growing demand for its cars in the country, state media reported today.

Through its joint venture Changan Ford Mazda, Ford will build the third plant in the southwestern Chinese city of Chongqing, almost next to its existing assembly plant in the city, the official Xinhua news agency said. Now the project has been confirmed by the U.S. auto maker.

Dongfeng Nissan to build Renault Logan by '10

Shanghai, May 18 (Gasgoo.com) Dongfeng Motor Co, a joint venture between the Dongfeng Motor Corp and Nissan Motors, said it would start manufacturing its 1.4L and 1.6L Renault Logan at its plant in Huadu, Guangzhou in 2010, Chinese industry website ifeng.com reported Monday.

Code-named L90, the Dacia Logan will be built on the existing B platform (notably Nissan Tiida/Versa and Renault Clio) at the South China plant, which may greatly reduce development and production costs for new launches.

SAIC Motor to build more 1.5L, 1.5T MG cars

Shanghai, May 18 (Gasgoo.com) SAIC Motor announced last week that it has adjusted its small-emission engine strategy based on the MG model and will mainly use the 1.5L and 1.5T series of engines on its future models, sina.com said today.

Since acquiring Nanjing Auto at the beginning of 2008, SAIC has restructured the MG powertrain strategy and the 2.566 billion yuan ($375.7 mln) new project in Nanjing will start production at the end of this year. This new facility will become China's largest production platform of A-class cars, including an engine production line with an annual capacity of 250,000 units.