Mr. Zeng and Mr. Feng’s first round of act: ￥15b output for R&D of GAC’s self-owned brand

SHANGHAI December 7th, Gasgoo–On November 1st, Zeng Qinghong, then general manager of GAC, took the place of retired Zhang Fangyou to be head of the group. Shortly after that, Feng Xingya succeeded Zeng Qinghong to be the general manager. Thus, the GAC Group entered into another ten years’ period.

In the past ten years, GAC has invested heavily in self-owned brands, whose core competence is R&D, and promote Trumpchi to be the most popular self-owned brand of recent two years. Sales of Trumpchi models have increased 80% to 296 thousand till the end of this October, while that of 2011 is 17 thousand, increased by more than 80%. This year, the expected sales of Trumpchi have surpassed 350 thousand.Then the most importance of the next step of GAC, leading by a combination of Mr. Zeng and Mr. Feng, is how to develop itself.

On November 1st, the GAC Group decided to add 15 billion yuan for the R&D of new energy and prospective technical projects, including technology research and development, the 1st and 2nd stage’s base construction projects of Research Institute, projects for factories and cars involving GAC self-owned brand’s Xinjiang project, Hangzhou renovation project, technical improvement projects and vehicle projects, and also the key component projects involving that for passenger car’s engines, gearboxs and P6 transmissions.

The GAC Group aims at a sales target of over 800 thousand and a production target of one million units by 2020, and plans to launch 20-30 models in the future 5 years.

However, the R&D system of self-owned brands is still in its first stage, and has many disadvantages. Firstly, it mainly focuses on products development with a lack of technology; secondly, it is not enough systematic and open to gain sustainable competitiveness; thirdly, it lacks prospective investment for future10 or 20 years.

Wang Qiujing from the Research Institution said that, we have to develop from our main business, which focused on products development, to two new main businesses including products development and technologies innovation at the same time, and develop from one battleground to two battlegrounds, one battle to two battles, and finally to achieve leadership from only following.

GAC’s Research Institution has built up 4 research centers for conceptual modeling, power assembly, the new energy automotive technology and intelligent connection respectively.

This October, Wang Qiujing went to Silicon Valley and confirmed the site for GAC’s American Research Institution. According to the planning of GAC Group, it may build other platforms in Europe and even in China to complete the construction of global network for R&D.