China auto news this week (Sept 19-Sept 21)

This week, we can continue to see a two-way street in Chinese automotive industry. In one direction, Chinese automakers are vigorously trying to explore overseas market. Chery is going to sell vehicles in Turkey and Great Wall is planing to sell their compact cars overseas before they are allowed to sell them at home. There is some bad news too. This week Chinese automakers are denied chances to start assembly plants in Russia, but that does not mean Chinese automakers have lost Russia market permanently.

In another direction, global automakers are trying to expand their operations in Chinese market. For example, Ssyang plans to start SUV production base in China, and General Motors is planning to start a R&D center in China. And quite surprisingly, an Iranian automaker is planning to start a production plant in China too.

The following stories from Gasgoo.com reflect the two-way street developments of Chinese automotive industry.  

Ssangyong plans to start production in China
 
By Joanne Jiu   From:Gasgoo.com September 14 2007   
 
Shanghai. September 14. (Gasgoo.com) - Ssangyong Motor Co., South Korea's fourth-largest automaker is planning to build its first factory in China after achieving a financial turnaround in its domestic operations, said the company chief.

"We have finished the market assessment with SAIC (Shanghai Automotive Industry Corp), and will proceed to talk about details such as factory site," Choi Hyung-tak, top executive of Ssangyong, told Yonhap News Agency at 2007 Frankfurt International Motor Show.

Choi expected to obtain a local legal person status soon after the Chinese government approves this project. Choi believes it's crucial for Ssangyong to have an overseas production unit as the company’s domestic market in South Korea is relatively limited.

The company, in which SAIC holds 51.33 percent stake, announced yesterday that it would raise production capacity by 55 percent at its only assembly plant in South Korea over the next three years. Ssangyong's August sales almost quadrupled from the previous year, the company said.

"We also need to strengthen the technical cooperation with SAIC," Choi added. Under cooperation agreement between SAIC and Ssangyang, SAIC would help Ssangyang upgrade its stereotype as a SUV-maker. There would be approximately 8 new models, including sedans and MPVs, to be added into Ssangyong's lineup by 2010.
 
The company will spend 8 percent of its annual revenue on the expansion plan by 2010, according to an Associated Press report. 

Lotus "Racer" to hit Chinese market soon
 
By Tony   From:Gasgoo.com September 19 2007
 
 
Shanghai. September 19 (Gasgoo.com) - Jinhua Young Man Automobile will import a Lotus "Racer" to Chinese market very soon and the vehicle will be sold at about 100,000-150,000 yuan ($13,295- $19,943), Chinese media reported today.

"Racer" is based on Gen-2 model displayed in a Lotus Show in Beijing last year. It has a 1.6 L, 112 horsepower engine.

The model is imported as complete-built vehicles but it will be locally made in China in the future, Beijing Business News said. 

Iran Khodro to enter Chinese auto market next year
 
By Tony   From:Gasgoo.com September 18 2007  
 
Shanghai. September 18 (Gasgoo.com) Iran Khodro Industrial Group, the biggest automaker in Iran, is planning to enter Chinese auto market via cooperation with the Jinhua Young Man Automobile in Zhejiang province, state media Xinhua News Agency reported today.

Hojjat, general manager of Iran Khodro Industrial Group said his company has set up a joint venture in the city of Tai An, Shandong province. The two sides have injected US$60 mln in initial investment. The joint plant is expected to start production by June 2008.

The project, with a projected total investment of US$200 mln, is designed to produce 120,000 vehicles annually. In this joint project, Iran Khodro holds 30 percent stake and Jinhua Young Man Automobile holds the remaining 70 percent, Xinhua News Agencey said.

"The project will be able to produce 30,000 vehicle at the begining, but output capacity will reach 120,000 in three years," Hojjat said. "The first vehicle produced by the joint venture will be Samand sedan or an entirely new model similiar to PSA 206SD."

The joint venture will not produce PSA brand cars, Hojjat stressed. Iran Khodro had a plan to produce PSA 206SD model in China but the plan met strong opposition from its partner PSA.

Apart from the joint venture plan, Iran Khodro also plans to export Samand LX and the latest model of Soren to China. Samand LX has reportedly finished certification process and Soren is in the middle of this process.

"We will start our export plan after the certification work is done," Hojjat said. "The export plan and local production are independent from each other."

"If everything goes smoothly, the first Iran vehicle will be sold in Chinese market next year," Hojjat. "We need to have a lot of dealers to join us." 

GM mulls opening the sixth global R&D center in China
 
By Joanne Jiu   From:Gasgoo.com September 19 2007 
 
 
Shanghai. September 19 (Gasgoo.com)--General Motors Corp. is studying the feasibility of seting up its new R&D center in China, while attempting to enter Chinese commercial vehicle market, China Business News reported yesterday.

"We are now studying all possibilities," said Kevin E. Wale, chairman and managing director of GM China, who confirmed GM had interests in exploring the untapped commercial vehicle market after long cooperation with SAIC in the passenger vehicle sector.

Currently GM has five global R&D centers in the U.S., Germany, S. Korea, Australia and Brazil. The projected research center, if founded, would be its sixth one. Chinese media said that GM China has bought a piece of land for the new center.

In China, GM has already set up a R&D center along with its Chinese partner SAIC, in which each controls a 50 percent stake. The center, established in 1997 and named Pan Asia Technical Automotive Centers (PATAC), serves Shanghai GM and SAIC-GM-Wuling, GM's two joint ventures in China.

The upcoming R&D center will be solely financed by GM, which analysts say could meet GM's ambition in China. It could also be a sore point between GM and SAIC, as the latter wants to create its independent brand and have more say in PATAC, said China Business News.

An unnamed source who is involved in GM's commercial vehicle project said that GM is assessing possibilities to partner with FAW, a leading commercial vehicle maker in China. 

Hyundai Genesis to be imported in China next year, priced at $53,200
 
By Ally   From:Gasgoo.com September 18 2007
 
Shanghai. September 18 (Gasgoo.com) - Hyundai Motor Group (China) plans to import the latest luxury sedan Genesis and the fifth-generation coupe to the Chinese market next year, state media Nanfang Daily reported yesterday.

Positioned between Hyundai Equus (called Centennial overseas) and Yazun (Azera), the 3.3L-3.8L Genesis will compete with Lexus ES, BMW 5-series and Benz-E series. This model is priced around 400,000 yuan (US$53,200).

In addition, another Hyundai coupe will be imported and go on sale in April next year. This fifth-generation Coupe features more luxurious designing and will be more competitive in terms of price compared with its rivals, like Nissan 350Z and Infiniti G-series.

V6 or V8 engines will be installed on this model and it may also be locally assembled in Beijing Hyundai's second factory.