China Auto News of the Week (Feb16 - 22)

Chinese auto parts exporters challenged by experts to raise technical contents

By Ally   From:Gasgoo.com February 22, 2008

Shanghai. February 22 (Gasgoo.com) - China's auto parts suppliers need to raise their innovation ability and technical contents in order to maintain a sustainable growth in exports, an auto export and senior official from China Chamber of Commerce for Import and Export of Machinery and Electronic Products (CCCME) said.
 
"High technical content auto components, like steering systems, chassis, transmissions, air conditioner, compressor and axle, only account for 18.3 percent of the total value of China's auto parts exports," said Fu Peizhao, deputy secretary general of the auto branch of CCCME.
 
He said while China is exporting a broad range of the auto parts, the lion's share of these products are low value-added auto parts with low technical content.
 
In addition, foreign owned or joint ventures auto parts suppliers account for 54.8 percent of the total export value while China's local suppliers only account for 24.3 percent of that volume, Fu said.
 
He said Chinese auto parts exporters must improve their competitiveness and realize economies of scale to face the challenge brought by mounting raw material cost and currency appreciation.

PSA seeks three-way partnership with Chinese automakers

By Joanne Jiu   From:Gasgoo.com February 20, 2008

Shanghai. February 20 (Gasgoo.com) - French automaker PSA Peugeot Citroen is seeking to set up a three-way joint venture with Chinese partners, Chinese newspaper Guangzhou Daily reported today.
 
Sources familiar with the issue said PSA will not give up its plan to set up another joint venture in China despite its unsuccessful attempt to tie-up with Hafei Group.
 
PSA Peugeot Citroen officials said Christian Streiff, CEO of PSA, will come to China to discuss a possible three-way tie-up with Dongfeng Motor and Hafei Auto, according to the Guangzhou Daily report.
 
PSA China and Hafei signed a memorandum of understanding to form a 50/50 JV in Shenzhen last June, but the partnership met opposition from PSA’s another partner Dongfeng Auto Group, which are trying to form a partnership with Hafei on its own.
 
Dongfeng Motor is doing due diligence on Hafei and Dongan Auto Engine, but it could take 2-3 months to finalize any dea, according to a Reuters report last month.
 
The spokesman for PSA China declined to comment on the possible three-way alliance

China sold 859,400 vehicles in January, up 2.39% m/m, 19.83% y/y

By Tony   From:Gasgoo.comFebruary 22, 2008

Shanghai. February 22 (Gasgoo.com) – China produced 826,700 vehicles in January, up 0.59 percent month-on-month and 8.49 percent year-on-year, according to a report prepared by China Association of Automobile Manufacturers earlier this week.
 
The CAAC report also said China sold 859,400 vehicles in home market in January, up 2.39 percent month-on-month and 19.83 percent year-on-year. 

 The table below shows China’s January vehicle sales in different market segment. 

China to levy full consumption tax on fuel oil

By Ally   From:Gasgoo.com February 20, 2008

Shanghai. February 20 (Gasgoo.com) - China's Ministry of Finance and State Administration of Taxation has begun to levy full consumption tax on fuel oil and naphtha as of January 1 of 2008, Shanghai Securities News reported, citing the finance ministry's announcement.
 
Under the new taxation policy, government will impose a tax rate of 0.10 yuan a liter for fuel oil and 0.20 yuan for lubricating oil and naphtha, which is used as a petrochemical feedstock and blending component for gasoline.
 
"This policy will create a lot of pressures on oil manufactures and sales companies," said an official of a fuel oil wholesale company in Shanghai. "Our profit margin will be narrowed by the new taxation policy.”
 
Industry insiders say most fuel oils and naphtha can be used directly as petrol or diesel and the purpose of the new taxation policy is to prevent tax evasions and tighten control over energy consumption.              

Delphi moves wire harness assembly line from Guangzhou to Wuhan

By Tony   From:Gasgoo.com February 19, 2008

Shanghai. February 19 (Gasgoo.com) – Global auto part supplier giant Delphi has recently moved its wire harness production facilities from Guangzghou in southern China to Wuhan in central China, local newspaper reported yesterday.
 
Last September, Delphi signed a contract with Whuan Development Zone to move its wire harness facilities to Wuhan in January. However, rare snowstorms in January have caused delays in the company original plan.
 
Delphi’s base in Wuhan will supply wire harness products to Dongfeng PSA’s three models: C-Triomphe, Peugeot 206 and Peugeot 307.
 
Delphi’s sales revenue in Chinese market topped RMB 10 billion ($13.8 B) last year, up 40 percent from one year earlier, the Shanghai-based Wenhui Daily reported.
 
Delphi supplier auto parts products to some leading automakers in China, like FAW-VW, Shanghai VW, Shanghai GM, Changan Ford and Dongfeng.
 
Delphi entered Chinese market in 1993. By April of 2007, Delphi’s total investment in China topped $500 million; the global auto parts giants operates 17 business units, which include an investment company, a global R&D center, a technology service center, a trading company and 13 production units.

23 foreign-made car models to debut in Chinese market this year

By Tony   From:Gasgoo.com February 18, 2008

Shanghai. February 18 (Gasgoo.com) – Twenty-three foreign car models made Japan, Germany, South Korea and United States are expected to be imported to Chinese market in 2008, Cheshi.com.cn reported today.

Notes:  1) Audi R8 goes on sale on January 17, priced at 249,300 in US dollars.
              2) Subaru 08 Tribeca goes on sale on January 21, priced 80,500 in US dollars.
              3) Dodge Avenger goes on sale on January 22, priced at about 40,500 in US dollars.
Source: Cheshi.com.cn

 Source: China Association of Automobile Manufacturers.