Dongfeng plans to focus on new energy vehicles

Shanghai January 14 (Gasgoo.com) Dongfeng Motor Corporation officially announced their plans yesterday to invest in new energy cars in the next three to four years.

In preparation for the Twelfth Five-Year period (2011-2015), Dongfeng is setting out a three-pronged strategy. First, the company's business scale will be based on two million units, emphasizing guaranteeing effective and quality sales, with the goal of achieving industry-leading profits. Secondly, the company aims to rapidly develop new energy and energy efficient vehicles by investing 3 billion yuan ($454m) into research and development. Its new energy models, including both hybrid electric and pure electric designs, are estimated to be revealed within the next two years. Finally, Dongfeng plans to increase investment in the creation and development of own brands and talent searching, with the goal of further innovating domestic production of passenger and commercial vehicles.

According to figures released by the company, Dongfeng's total production last year was 2.66 million vehicles (an increase of 39.98% from 2009), with 2.61 million sold (up 37.8% from 2009). The company was able to meet its sales goal in late November and by October had already surpassed its 2009 sales.

Meanwhile, investment firm Morgan Stanley increased Dongfeng Motor's target price from HK$12.50 ($1.608) to HK$13.50 ($1.736) and its estimated annual profit for years 2010, 2011 and 2012 to 10.9 billion yuan ($1.65m), 9.9 billion yuan ($1.5m) and 10.7 billion yuan ($1.62m) respectively.