Guangzhou Automobile Industry Group to increase China-made 90%

Denway Motors and Guangzhou Automobile Industry Group (GAIG) said yesterday that Denway Motors major source of profits -- Guangzhou Honda is expected to be complete a 300,000 sales target this year, GAIG intends to realize its products are China-made from the current 80% to around 90%.

Guangzhou Honda sales up to 107,400 units in the first five months, increased  6.3% year on year; It is expected Guangzhou Honda to complete more than 300,000 units in the sales target this year. Denway Motors (0203HK) Vice president Lu Zhifeng said yesterday.

Guangzhou Honda plans to build an engine production base in Guangzhou. But Lu said setting up engine production base are still under consideration, therefore, no detailed information can be disclosed.

GAIG sales revenues are mainly from the auto parts business and high value-added automobiles sales, which accounted for 70% of total revenue.

At present, more than 80% of GAIG products are made in China; GAIG plans to raise the figure to 90%. As a result, parts procurement costs will be further reduced. It is expected that parts sales will increase 40% this year.