FAW invests $457 mln to upgrade own-brand sedan production

Shanghai August 26 (Gasgoo.com) China's auto giant FAW Group announced today that it plans to invest in three projects, totaling approximately 3.11 billion yuan ($457 million) which will mainly be used to upgrade production of its own-brand sedans and engines, Securities Times said Thursday.

In a bid to enhance its product line up and strengthen its burgeoning, FAW will invest 1.76 billion yuan in the H platform C131 project, using the existing factory, which is expected to increase the company's annual production capacity to 30,000 C131 vehicles by 2013.

FAW will launch four own-brand Red Flag (Hongqi) models by 2012 and all the models will be using an H platform developed by its own engineers, according to early sources.

With the implementation of H platform C131 project, the company will be able to improve its product lineup, enrich the mid- to high-end product lineup and increase influence of the Red Flag brand.

The second project will cost the automaker 690 million yuan and secure the company an annual capacity of 70,000 4GC engines if completed. The 4GC engines will be used to power FAW's own brand mid- and high-end sedans.

In addition, the company will invest 650 million yuan in restructuring of the press shop, through which it aims to produce 560,000 pieces of stamping parts annually.

FAW posted revenue of 17.9 billion yuan for the first half of this year, up 54% from a year earlier. The company's net profit surged 150% year on year to about 1.34 billion yuan or 0.82 yuan per share.