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SUPPLEMENT TO APRIL 14, 2008

© 2008 Crain Communications. All rights reserved. autonews.com

2008 Guide to ’s Auto Market Global automakers’ joint ventures • Domestic Chinese automakers Vehicle production and sales data • Map of production facilities in China 2008 GUIDE TO CHINA’S AUTO MARKET 3

As economy booms, consumers Contents snap up SUVs and luxury n the West, higher fuel prices are prompting drivers to log fewer miles and embrace smaller, energy-efficient 4 vehicles. INot so in China, where wealth generated 2007 sales by the booming national economy has by brand more than offset rising fuel prices. In 2007, 5.2 million passenger vehicles were sold in China, up 21 percent from 2006, according to Automotive Resources 6 Asia, a unit of J.D. Power and Associates. Global Gasoline-gulping SUVs enjoyed the automakers/ strongest growth, up 50 percent. Auto prices across China dropped in joint ventures 2007 by an average of 5.7 percent, accord- ing to the China Association. Meanwhile, per capita in- 19 come of urban residents increased 12.2 percent from 2006, to $1,942. Map of The Chinese government maintains production some controls on fuel prices. The most ROGER HART facilities in widely used grade of gasoline was raised 8 percent in November to the equivalent of CHINA’S RIP-ROARING NATIONAL ECONOMY IS FUELING A GROWING AUTO INDUSTRY THAT HAS SPAWNED EVENTS SUCH AS THE AUTO SHOW, ABOVE. China $2.77 per gallon. Meanwhile, the government repeatedly By contrast, Hyundai group’s sales vol- has said the domestic auto industry is fac- ume tumbled 16.5 percent last year. SALES ON THE RISE 20 ing excess capacity. But automakers aren’t In 2007, Volkswagen was still the clear Segment sales of light responding to the pressure. leader in China. Supported by its two joint vehicles in China in 2007 Domestic Almost all automakers are ramping up ventures — Shanghai Volkswagen Auto- 2007 % CHANGE production and developing new models. motive Co. and FAW-Volkswagen Auto- SALES FROM automakers 2006 In 2007, about 200 passenger-vehicle motive Co. — VW held a market share of Microcar models were sold in China, double the 17.5 percent. It was followed by General 329,000 0 30 number in 2005. The number will rise to Motors with 10.1 percent. Subcompact 250 in 2008, according to the forecasting Last year, the industry started what many OEM suppliers 1.3 million 4.0 firm CSM Worldwide. expect will be a significant wave of consoli- Compact in China Meanwhile, some cash-rich nonauto- dation among state-owned automakers. In 1.9 million 31.0 motive domestic companies want to enter December, Shanghai Automotive Industry Mid-sized the market. In 2007, motorcycle maker Corp. acquired Automobile Group 947,000 29.0 Chongqing Loncin Holdings said it would Corp. Online Luxury form a joint venture with the British com- The Chinese auto industry is so compet- 209,000 35.0 Download this guide pany Antonov to manufacture small auto- itive that various automakers, such as SUV in pdf format at matic transmissions for passenger vehi- Automobile Co. and Chongqing 357,000 50.0 cles in China. The move was widely seen Lifan Industry Group, see overseas mar- www.autonews.com Small as Loncin’s latest attempt to transform kets as their best opportunity to grow. /chinaguide multipurpose itself into an automaker. They are quickly building their presence in vehicle 59,000 16.0 Thanks to stellar performances of new other developing markets, such as the Multipurpose Data in this publication were models, domestic Chinese brands and Middle East, North Africa and Russia. provided by Automotive vehicle 173,000 22.0 Resources Asia Ltd. Japanese brands gained ground in 2007, Some Chinese automakers — including Source: Automotive Resources 1106 Q House Building largely at the expense of Korean brands. Automobile Holdings Ltd., Brilliance Asia Sukhumvit Soi 21 Asoke Bangkok, Thailand 10110. The combined market share of Chinese Automobile Co. and BYD Auto Co. www.auto-resources-asia.com. brands increased 2.3 percentage points — have displayed products at auto shows Note: Sales data reflect while that of Japanese brands rose 1.1 per- in the United States and . But it is vehicles produced in China centage points. Meanwhile, Korean brands widely thought that they still have a long unless noted. lost 3.1 percentage points. way to go to succeed in Western markets, Cover photo: Sports Toyota closed the year with sales up where quality and engine emissions stan- specialist Spyker Cars more than 60 percent over 2006. The dards are much more rigorous than in attracts a crowd to its stand at an auto show in China. Camry alone contributed more than half China. • Photo by Patrick Firouzian of the new volume. — Yang Jian

2008 GUIDE TO CHINA’S AUTO MARKET Automotive News • J.D. Power and Associates • Automotive Resources Asia AN AUTONEWS 04-14-08 D 4 AUTONEWS 4/9/2008 3:19 PM Page 1

4 BRAND SALES

The Volkswagen group remained the top automaker in China in 2007, ranked by brand sales of passenger vehicles. held the second spot, but the Toyota group is gaining ground quickly.

CHINA PASSENGER VEHICLE BRAND SALES

Global brands: 2007 2006 % chng. Domestic brands: 2007 2006 % chng. Volkswagen group 946,433 775,039 22.1 Chery 369,459 302,478 22.1 Audi 92,200 77,192 19.4 Geely group 219,513 205,123 7.0 Skoda 31,802 – – Geely 184,176 176,320 4.5 Volkswagen 822,431 697,847 17.9 35,337 28,803 22.7 General Motors group 527,915 446,706 18.2 Xiali 182,271 199,323 –8.6 331,780 300,700 10.3 Haima 130,988 80,218 63.3 4,384 547 701.5 191,751 145,459 31.8 Jinbei group 129,666 73,059 77.5 Jinbei 15,349 10,062 52.5 Toyota group 455,038 280,424 62.3 Zhonghua 114,317 62,997 81.5 Toyota 452,912 280,424 61.5 Daihatsu 2,126 – – BYD 94,683 60,116 57.5 422,341 323,469 30.6 Great Wall 64,732 40,062 61.6 Hyundai group 343,210 411,154 –16.5 Changan 55,515 17,974 208.9 Hyundai 243,881 296,154 –17.7 JAC 48,114 34,363 40.0 Kia 99,329 115,000 –13.6 44,799 65,391 –31.5 281,520 211,337 33.2 Lifan 30,101 7,365 308.7 PSA Peugeot Citroen group 207,255 201,318 2.9 FAW Car Co. 27,953 9,402 197.3 Citroen 115,036 120,039 –4.2 Changfeng 25,758 24,688 4.3 Peugeot 92,219 81,279 13.5 Dongfeng 22,341 18,818 18.7 Ford Motor group 180,476 134,385 34.3 Ford 174,085 131,061 32.8 16,549 – – Volvo 6,391 3,324 92.3 Jiangling 16,323 14,070 16.0 Suzuki 161,066 159,547 1.0 Zhongxing 10,771 8,716 23.6 Mazda 89,838 47,211 90.3 7,295 18,400 –60.4 Mitsubishi 67,236 54,222 24.0 6,254 14,356 –56.4 BMW 32,249 23,735 35.9 Beiqi 5,566 2,822 97.2 Ssangyong 14,472 6,648 117.7 MG Mingjue 3,131 – – 13,484 30,668 –56.0 Foton 1,717 1,152 49.0 Chrysler group 9,277 6,801 36.4 Chrysler 8,959 2,188 309.5 Note: Reflects sales of locally produced passenger vehicles (cars, SUVs and MPVs); does not include Jeep 318 4,613 –93.1 minivehicles, pickups or commercial vehicles; does not include sales of import vehicles Daimler (Mercedes) 6,882 5,508 24.9 Source: J.D. Power and Associates, Automotive Resources Asia

2008 GUIDE TO CHINA’S AUTO MARKET Automotive News • J.D. Power and Associates • Automotive Resources Asia 6 GLOBAL AUTOMAKERS/JOINT VENTURES

BMW AG Beijing Representative Office JV: BMW Brilliance Automotive Ltd. 28/F, Tower B, Gateway Plaza No. 14, Shanzuizi Road, Dadong District, Shenyang City Chaoyang District, Beijing 100027, P.R. China Province 110044, P.R. China (86) 10-8455-8000, www..com.cn (86) 24-8455-6000, www.bmw-brilliance.cn Top executive: Alfred Rupp, president Top executive: Christoph Stark, president & CEO

Luxury cars in China are hot, and BMW AG Imports grew impressively. China remained wants to take full advantage of the trend. the second-largest market for the imported In the first half of 2008, BMW plans to raise 7 series last year by selling 10,688 units, up 42 its capacity in China to 44,000 units percent from 2006. The more than annually. doubled sales in the Chinese mainland. Sales of luxury vehicles rose 35 percent in BMW will introduce the 1 series to China, China in 2007. Alfred Rupp, president of BMW’s joint BMW, including Mini, sold 51,588 cars in venture in China, said in a recent interview. the Chinese mainland last year, up 42 He also mentioned BMW would continue to percent from 2006. Those figures include look into the rapidly growing SUV market. imports, says the company. BMW says its long-term strategy is to MINI But to catch the luxury leader — Audi — produce more cars locally in China. Last year, BMW has a long way to go. The top-selling Sales of the locally produced 5 series and 3 the automaker’s local purchasing volume rose luxury car — the Audi A6, with sales of 72,638 series by its joint venture, BMW Brilliance 80 percent to 3.6 billion yuan ($501 million). — outsold BMW and Mini combined last year. Automotive Ltd., rose 35.9 percent to 32,249 Also, BMW estimates the number of its Meanwhile, rival Mercedes-Benz will start last year. The growth was driven by the new joint venture’s suppliers will reach 150 this producing C-class sedans in China this 5-series long- designed for summer. Currently, engines and a few spring, providing competition for BMW’s China. The sedan accounted for sales of electronic components are still imported. locally made 3 series. 17,647 units, up 61 percent from 2006. BMW added 20 outlets for sales and service Another big luxury challenger is Toyota. The locally made 3 series posted the in 2006, and the number reached 90 by the Last year the Crown posted sales of 53,111, weakest growth among luxury models — up end of 2007. according to Automotive Resources Asia. only 3.1 percent in 2007. — Lan Lan

2007 2006 Models produced: Ownership: Capacity 41,000 30,000 BMW 320i, BMW 325i, BMW 523i, BMW 525Li, BMW AG 50% Production 34,720 25,808 BMW 530Li Brillance China Automotive Holdings 50% Unit sales 32,249 23,735 8 GLOBAL AUTOMAKERS/JOINT VENTURES

DaimlerChrysler China Ltd. JV: -DaimlerChrysler 1/23F Landmark Tower, No. 8 N. Dongsanhuan Road Automotive Co. Chaoyang District, Beijing 100004, P.R. China No. 8 Boxing Road, Beijing Economic-Tech Area Beijing 100176, P.R.China (86) 10-6590-6668, www.daimlerchrysler.com.cn (86) 10-6782-4888, www.bbdc.com.cn Top executive: Ulrich Walker, DCNEA chairman & CEO Top executive: Guenter Butschek, president & CEO

Daimler AG struggled in China in 2007. overshadowed in 2008. Lexus sells The luxury market was hot, but sales of three sedans in China and Daimler’s only domestically produced launched the imported LX 570 model, the Mercedes-Benz E class, were SUV in January. modest. The Lexus is the car of choice for Chinese consumers flocked to domestically rich Chinese businessmen, says an produced BMW and Audi sedans at the low executive at a U.S. consulting firm. end of the segment and imported Lexus Lexus’ strong point: The buying vehicles at the high end. experience, the consultant says. Stuck in the middle, Mercedes faced a Lexus’ 39 dealerships know how to tough market for the E class, which sold make customers feel they are 6,882 units in 2007. By contrast, Audi A6 buying luxury items. sales reached 72,638 last year. In 2008, Daimler will be busy Sales of locally produced Mercedes C-class trying to separate itself from cars began in March, but that model will Chrysler LLC in China. The two face the same problems. parted ways in 2007, but they The luxury segment in China is MERCEDES E CLASS share a manufacturing site, an competitive. BMW produces its 3 and 5 office and a marketing staff in series locally — the 5 series is a stretch S-class sedans in China, including Hong China, so separation is complicated. version for China’s chauffeur-driven Kong and Macao. It sold 3,000 imported On the marketing side, Mercedes must passengers. The Toyota Crown and a stretch SUVs. figure out how to trump that Lexus version of the Audi A6 sedan also are The imported Mercedes S350 has a rear- experience so S-class sales can grow produced locally. entertainment system customized for strongly. And it must figure out how to make Imports were Mercedes’ strong point in China’s chauffeur-driven passengers. its locally produced models more attractive 2007, but there, too, the competition was But the S class was eclipsed by Toyota’s than a BMW or an Audi. stiff. Mercedes sold 11,500 imported Lexus brand in 2007 and will continue to be — Alysha Webb

2007 2006 Models produced: Jeep 2500/2700; Mitsubishi Ownership: Capacity 100,000 100,000 Outlander; Chrysler 300C; Mercedes-Benz E class Beijing Automotive Industry Holding Corp. 50.4% Production 20,236 18,726 DaimlerChrysler AG (DCAG) 37.2% Unit sales 19,730 21,308 DaimlerChrysler (China) Limited (DCCL) 12.4%

Chrysler LLC Asia Operations 1/23F Landmark Tower, No. 8 N. Dongsanhuan Road Chaoyang District, Beijing 100004, P.R. China (86) 10-6590-6668, www.chrysler.com.cn Top executive: Philip Murtaugh, CEO

Expanding Chrysler LLC’s tiny presence in won’t begin until at least 2009. China will be a tough job for Phil Murtaugh, Chrysler stopped producing Jeep models the head of Chrysler’s Asian operations. in China in 2007. The Jeep brand now relies In the future, China may be more on imports. important to Chrysler as a production base This is a crucial year for Chrysler in China. for small cars than as a market. Chrysler Murtaugh must create consumer interest in took steps to make that a reality in 2007. the Chrysler brand and further introduce the Murtaugh in September was hired away Dodge brand into China’s hypercompetitive from a job supervising overseas operations market. for Shanghai Automotive Industry Corp. CHRYSLER GRAND VOYAGER In early 2008, the automaker added the Well connected in China, he formerly was completing an agreement with Chery Chrysler Sebring sedan to its domestic head of General Motors’ China operations. Automobile Co. to produce small cars for production lineup. In 2007, Chrysler produced only one car export. The two sides signed a memorandum Chrysler also began importing the Dodge model in China, the 300C sedan. It sold of understanding in July. A final agreement Avenger and Dodge Caliber sedans in early 7,743 units. had not yet been signed as of early March. 2008. The Dodge brand was introduced in China When the agreement is signed, reports say In 2008, Chrysler also must work out its in November 2007 with the launch of the the two will start by exporting a version of relationship with its former owner, Daimler Caravan . The Chrysler Grand Voyager an existing Chery model to markets in Latin AG, in China. The two share a paint shop at van was launched in China a few months America. The car’s exterior will be restyled to Beijing Benz-DaimlerChrysler Automotive Co. earlier. Both are being produced under give it a Chrysler look, industry sources say. and numerous executives. As of early March, license at Southeast Motor Co. Exports to Latin America are expected to the separation was still being worked out. In 2007, Chrysler moved closer to begin in 2008. Exports to the United States — Alysha Webb

2008 GUIDE TO CHINA’S AUTO MARKET Automotive News • J.D. Power and Associates • Automotive Resources Asia 10 GLOBAL AUTOMAKERS/JOINT VENTURES

Fiat (China) Business Co. JV: Nanjing Fiat Auto Co. Unit 2011, Beijing Silver Tower, No. 2 Dongsanhuan North Road No. 66, Taixi Road, Jiangning High-Tech Park Beijing 100027, P.R. China Nanjing City, Province 211100, P.R. China (86) 10-6410-0666, www.fiatgroup.com (86) 25-5210-0000, www.fiat.com.cn Top executive: Xu Jiufeng, CEO Top executive: Franco Amadei, chairman

For Fiat Auto S.p.A., 2007 was a year of relationship with Nanjing Auto. had not been completed as of late February. relationships. One ended and another Meanwhile, Fiat’s relationship with Chery Without a plant in China, Fiat announced blossomed. Automobile Co. grew closer in 2007. in late 2007 that it would begin importing It was also a year when Fiat’s sales in China In August Fiat and Chery completed an three models in 2008: the Bravo, Punto and continued to fall as the automaker failed to agreement under which Chery will produce Linea. Local production of all three will introduce new models. 100,000 engines annually for Fiat to use in begin in 2009, Fiat said. Fiat became a second wife to longtime China and worldwide. This year is crucial for Fiat in China. CEO partner Group Corp. A day later, Fiat said it would form a joint Sergio Marchionne has said Fiat aims to sell when the Chinese automaker began to venture with Chery to produce 175,000 cars 300,000 cars in China by 2010. To reach that manufacture its own car based on the MG annually. The first two models slated for goal, Fiat must start by producing cars in sedan in late 2007. In December, Fiat production are the Alfa Romeo 159 and Fiat China again. announced that it was ending its Linea sedans. The joint-venture agreement — Alysha Webb

2007 2006 Models produced: Ownership: Capacity 100,000 100,000 , Palio Weekend, Siena, Perla Fiat Auto S.p.A. 50% Production 17,164 30,974 Nanjing Automobile Group Corp. 50% Unit sales 13,484 30,668

Ford Motor China 33F, Shanghai Information Tower, 211 Century Ave. District, Shanghai 200120, P.R. China (86) 21-2891-6688, www.ford.com.cn Top executive: Robert Graziano, CEO

Ford Motor Co. is struggling in North market with many new cars at once, says America. But not in China. Yale Zhang, director of emerging-markets The automaker’s Mazda vehicle forecasts at CSM Worldwide. Automobile Co. joint venture sold 217,100 Says Zhang: “I have confidence in Ford’s cars in China last year, up an eye-popping strategy in China.” 67.3 percent from 2006. Ford’s luxury sales also are growing. Ford made a relatively late entry into Sales of the locally made Volvo S40 jumped China in 2003. Its first China-built 92.3 percent in 2007 to 6,391 units. The car, passenger vehicle, the Fiesta, sold poorly. which starts at $42,485, won 3 percent share Ford now is growing nicely. That’s largely FORD FOCUS of the domestically produced luxury market. because of the Ford Focus, which accounts Sales of imported Volvo, Jaguar and Land for 57.6 percent of the joint venture’s sales. A Another , the Mazda2, started Rover cars zoomed up 84 percent to 20,103 total of 124,991 Focus cars were sold in selling in China in December. The car is made units in 2007. China in 2007. at the plant in Nanjing. Changan Ford Mazda’s assembly plant in Ford and its joint venture partners operate Changan Ford Mazda is a joint venture of Chongqing produces the Ford Focus, Ford three vehicle assembly plants and one Ford Motor Co., Mazda Motor Corp. and Mondeo, Ford S-Max, Volvo S40 and Mazda3, engine manufacturing plant in China. Ford Changan Automotive Corp. with an annual capacity of 250,000 vehicles. operations also include an automotive At the Beijing auto show in April, Ford is The company’s new plant in Nanjing, financing company and a Nanjing-based expected to display the new Fiesta sedan which opened in September 2007, boosted parts sourcing and r&d center. and hatchback. The hatchback will begin capacity to 410,000 vehicles a year. The Focus hatchback “is more attractive sales in China in the second half of 2008, In January, Ford launched a new- than the traditional three-box sedan for with sedan sales starting in early 2009. The generation Transit van with its commercial- young, single and female buyers in the car will be built at the Nanjing plant. vehicle joint venture partner, Jiangling cities,” says Mei Songlin, China general Ford’s strategy calls for introducing cars at Motors Corp. manager at J.D. Power Asia Pacific Inc. a steady rate. It does not want to flood the — Namrita Chow

JV: Corp. JV: Changan Ford Mazda Automobile Co. No. 509 Ying Bin Ave. North, Nanchang City No. 1 Changfu West Road, Yuan Yang Town Jiangxi Province 330001, P.R. China New Northern Zone, Chongqing 401122, P.R. China (86) 791-5266-000, www.jmc.com.cn (86) 23-6745-8888, www.ford.com.cn Top executive: York Chen, president & CEO Top executive: Shen Yingquan, president & CEO

2007 2006 Ownership: 2007 2006 Ownership: Capacity 100,000 100,000 Jiangling Holding Co. 41% Capacity 410,000 200,000 Ford Motor Co. 50% Production 26,480 22,949 Ford Motor Co. 30% Production 205,680 137,782 Changan Automotive Co. 35% Unit sales 26,585 22,937 Other 29% Unit sales 217,100 129,790 Mazda Motor Co. 15% Models produced: Ford Transit Models produced: Ford Focus, Mondeo, S-Max; Mazda3; Volvo S40

2008 GUIDE TO CHINA’S AUTO MARKET Automotive News • J.D. Power and Associates • Automotive Resources Asia 12 GLOBAL AUTOMAKERS/JOINT VENTURES

General Motors China Investment Co. Jingmao Tower 10/F, No. 88 Shiji Road, Pudong District Shanghai 200121, P.R. China (86) 21-2898-7000, www.gmchina.com Top executive: Kevin Wale, chairman & CEO

In 2007, General Motors expanded China’s attributed the role in global r&d with a new proving slower growth to a ground and an engineering center. GM’s lack of new sales in China remained strong. models. “We’re During an October visit to China by CEO going through Rick Wagoner, GM said it would build a that period where wholly owned r&d center here. The center is we are refreshing part of a $250 million corporate campus. Its the product line,” research will focus on alternative fuels and he said. advanced propulsion systems. GM introduced The r&d center also will help certify local only two new suppliers, speeding up sourcing of domestically components from China for GM’s produced models worldwide operations. in China in 2007, Also in October, GM announced a $225 the Buick Park million proving ground in the central China Avenue sedan and province of Anhui. The proving ground is a the Chevrolet joint investment with manufacturing Epica. GM also began importing the partner Shanghai Automotive Industry Corp. Twin Top convertible and the Opel At the same time, GM announced it will Astra GTC. build a proving ground in Korea at its In 2008, GM is bringing environmentally subsidiary. friendly technology to China. In January it Now, GM r&d chief Jim Queen can ask launched the LaCrosse hybrid sedan, either Korea or China to support worldwide produced at its joint venture with Shanghai r&d activities and product development, Automotive. GM will launch three new said Nick Reilly, president of GM Asia engines, all offering better fuel economy Pacific. than its current lineup, the company says. In November, GM established a joint GM also will introduce another hybrid venture with Shanghai Automotive to TWIN TOP model. provide OnStar telematics service to China. Hybrids aren’t likely to boost GM’s sales in OnStar provides navigation assistance, with 2006, according to Automotive China much, although they will win kudos accident notification, roadside assistance Resources Asia. In 2006, sales rose 28.5 from the Chinese government. and vehicle diagnostics. percent. GM sold 527,915 cars in China in In 2008, look for GM to introduce in China On the sales side, GM’s growth slowed in 2007. new vehicles based on its global platforms. 2007. Sales rose only 18.2 percent compared Kevin Wale, president of GM China, — Alysha Webb JV: Shanghai General Motors Corp. JV: Shanghai GM Dongyue Motors Co. No. 1500 Shenjiang Road, Jin Qiao, Pudong DIstrict No. 118 Changjiang Road, Development Zone, Yantai City Shanghai 201206, P.R.China Province 264006, P.R. China (86) 21-2890-2890, www.shanghaigm.com (86) 535-6966-666, www.chevrolet.com.cn Top executive: Ding Lei, president Top executive: Huang Keji, president

2007 2006 Excelle, Excelle HRV; Cadillac SLS, 2007 2006 Ownership: Capacity 380,000 320,000 Royaum Capacity 150,000 120,000 Shanghai General Motors 50% Production 288,638 268,022 Ownership: Production 138,326 106,686 Shanghai Automotive Co. 25% Unit sales 268,000 268,642 SAIC Motor Corp. 50% Unit sales 159,241 105,444 General Motors China 25% Models produced: General Motors 50% Models produced: Buick LaCrosse, Park Avenue, Regal, , Sail SRV, Epica, Aveo, Lova

JV: Shanghai GM (Shenyang) Norsom Motors Co. JV: SAIC-GM-Wuling Automobile Co. No. 15 North of Daying Road, Dadong District, Shenyang City No. 18 Hexi Road, Liuzhou City Liaoning Province 110044, P.R. China Guangxi Province 545007, P.R. China (86) 24-8834-5678, www.buick.com.cn (86) 772-3750-258, www.sgmw.com.cn Top executive: Xu Linhua, president Top executive: Shen Yang, president

2007 2006 Ownership: 2007 2006 Ownership: Capacity 50,000 50,000 Shanghai General Motors 50% Capacity 400,000 400,000 Shanghai Automotive Co. 50% Production 40,627 40,031 Shanghai Automotive Co. 25% Production 29,871 42,416 General Motors China 34% Unit sales 40,031 38,030 General Motors China 25% Unit sales 32,510 40,015 Wuling Automotive 16% Models produced: Buick GL8 Models produced:

2008 GUIDE TO CHINA’S AUTO MARKET Automotive News • J.D. Power and Associates • Automotive Resources Asia GLOBAL AUTOMAKERS/JOINT VENTURES 13

Honda Motor China Investment Co. Suite 301, Beijing Fortune Building, No. 5 N. Dongsanhuan Road, Chaoyand District, Beijing 100004, P.R. China (86) 10-6590-9011, www.honda.com.cn Top executive: Hyogo Atsuyoshi, president

Honda Motor Co. enjoyed an excellent Guangzhou Honda sold 118,024 Accords in 2007 in China. Sales rose 30.6 percent last 2007, down 4.2 percent. The Accord was the year to 422,341 units. best-selling car in its segment before Toyota But a resurgent Toyota Motor Corp. could launched the Camry in mid-2006. In the past slow Honda’s growth in 2008. decade, the Accord accounted for more than Propelling Honda’s growth was its joint half of Honda’s sales and profits in China. venture Automobile Co. Fighting back, this year Honda introduced Dongfeng Honda’s sales doubled from 2006 a redesigned Accord. But sales have been HONDA ACCORD to 127,086 units last year, encompassing about 7,500 units per month, well behind 81,339 Civic cars and 45,703 CR-V crossovers. venture, Guangzhou Co. the Camry’s 12,500 units or so per month. The company started China production of Sales of the company’s best-selling model, Guangzhou Honda’s Fit subcompact will the CR-V in 2004 and the Civic in 2006. the Accord sedan, were slowed by face competition from the Toyota Yaris. It was different for another Honda joint competition from the Toyota Camry. — Kevin Huang

JV: Honda Automobile (China) Co. JV: Dongfeng Honda Automobile (Wuhan) Co. No. 363 Kai Chuang Avenue, East Section, Guangzhou Economic & No. 283 Checheng Dongdao, Economic & Technical Development Zone Technological District, Guangzhou City, Guangdong Province 510760, P.R. China Wuhan City, Hubei Province 430056, P.R. China (86) 20-3228-8000 (86) 27-8428-6000, www.dhac.com.cn Top executive: Masaya Nagai, president Top executive: Mitsuru Ozaki, president 2007 2006 Ownership: 2007 2006 Ownership: Capacity 50,000 50,000 Honda Motor Co. 55% Capacity 120,000 120,000 Dongfeng Motor Corp. 50% Production 43,584 24,604 Guangzhou Automobile Production 124,976 66,004 Honda Motor Co. 40% Unit sales 43,124 24,600 Industry Group Co. 25% Unit sales 127,086 63,373 Honda Motor Investment Co. 10% Models produced: Honda Motor Investment Co. 10% Models produced: Honda Civic, CR-V, Honda Jazz (for export) Co. 10% Civic Hybrid

JV: Guangzhou Honda Automobile Co. 2007 2006 Ownership: No. 1 Guangben Road, Huangpu District, Guangzhou City Capacity 360,000 360,000 Guangzhou Automobile Industry Guangdong Province 510700, P.R. China Production 295,254 261,943 Group Co. 50% (86) 20-8227-7789, www.guangzhouhonda.com.cn Unit sales 295,299 260,096 Honda Motor Co. 40% Top executive: Okawara Eiji, president Models produced: Honda Accord, Fit, Honda Motor Investment Co. 10% City, Odyssey

Hyundai Motor Group China Ltd. Room 701, Hyundai Motor Tower, No. 38 Xiaoyun Road, Chaoyang District, Beijing 100027, P.R. China (86) 10-8453-9666, www.hmgc.com.cn Top executive: Lee Il Jang, president

Hyundai and Kia would like to forget 2007. will open a second plant to better suit the tastes of Chinese China’s auto market grew 21.3 percent, but in April, doubling capacity to 600,000 units. consumers — largely meaning more chrome sales at Hyundai Motor Group China Ltd. The sales target for the year is about a 64 highlights on the Sonata and other staple dropped 16.5 percent. percent increase, to 380,000 units. models. For instance, sales at the group’s Beijing New models planned for China in 2008 are For 2008, Kia plans to begin exporting its Hyundai Motor Co. fell 20.3 percent from the Elantra in April, the Genesis sport luxury new Borrego large SUV from Korea to China 2006 to 231,137 units, well below the target sedan in June, the Genesis coupe in October in June. Automobile Co. of 310,000 units. Hyundai and Kia are and the Sonata FL in November. The Genesis began production at its second factory in addressing the situation in China by keeping models will be produced in Korea. October. high sales goals and adding capacity. Hyundai says new models will be tailored — Gary Anglebrandt

JV: Beijing Hyundai Motor Co. JV: Dongfeng Yueda Kia Automobile Co. No. 18 Shuntong Road, Linhe Industry Development Area, Shunyi District No. 18 Kaifang Road, Yancheng City, Jiangsu Province 224002, P.R. China Beijing 101300, P.R. China (86) 515-8226-262, www.dyk.com.cn (86) 10-8949-0088, www.beijing-hyundai.com.cn Top executive: H.K. Lee, president Top executive: J.M. Noh, president 2007 2006 Ownership: 2007 2006 Ownership: Capacity 150,000 130,000 Kia Motors 50% Capacity 300,000 300,000 Hyundai Motor Co. 50% Production 105,028 114,523 Dongfeng Motor Industry Production 231,888 290,088 Beijing Automotive Unit sales 101,427 115,000 Investment Co. 25% Unit sales 231,137 290,011 Industry Holding Corp. 50% Models produced: Kia Sportage, Accent, Jiangsu Yueda Co. 25% Models produced: Hyundai Elantra, Carnival, Optima, Cerato, Rio NF, Sonata, Tucson, Verna

2008 GUIDE TO CHINA’S AUTO MARKET Automotive News • J.D. Power and Associates • Automotive Resources Asia 14 GLOBAL AUTOMAKERS/JOINT VENTURES

Mitsubishi Motors Corp. F18 Eastern Wing, Hanwei Plaza, No. 7 Guanghua Road Chaoyang District, Beijing 100021, P.R. China (86) 10-6561-3030, www.mitsubishi-motors.com.cn Top executive: Hiromi Endo, general manager

Mitsubishi Motors Corp. is proof that in Sales last year were flat from 2006, and vehicles a year earlier. China sales don’t always go up. Mitsubishi hasn’t given an outlook for 2008. Mitsubishi’s China business could get a big The company is in a rebuilding phase in To stop the decline, it aims to strengthen its lift from launching the redesigned Lancer, China and expects sales of Mitsubishi- local sales networks. Part of the plan is which has already debuted in the United related vehicles, including those built by increasing sales of imported Mitsubishi cars. States, Europe and Japan. But Mitsubishi is licensees, to fall to 77,000 units in 2010. That On that score, the company has posted still deciding whether the sporty sedan will is a 21.2 percent drop from 97,765 in 2007, modest success, having boosted import make it to China in 2008. according to company figures. sales to 9,970 units last year from 4,000 — Hans Greimel JV: Hunan Co. JV: Soueast (Fujian) Motor Co. 18/F Hualing Building, 111# Second Section, Furong Mid Road Dongnan Industrial Area, Fuzhou City Changsha City, Hunan Province 410011, P.R. China Fujian Province 350119, P.R. China (86) 731-2881-800, www.cfmotors.com (86) 591-2276-6566, www.soueast-motor.com Top executive: Li Jianxin, president Top executive: Jian Qinglong, general manager

2007 2006 Ownership: 2007 2006 Ownership: Capacity 80,000 80,000 Changfeng Group 50% Capacity 150,000 150,000 Mitsubishi Motors Corp. 25% Production 24,546 23,574 Others 35% Production 40,056 42,572 Fujian Motor Industry Group 50% Unit sales 24,428 24,688 Mitsubishi Motors Corp. 15% Unit sales 45,679 45,360 China Motor Corp. 25% Models produced: Liebao (Mitsubishi Models produced: Lioncel, Landio, Pajero) Soveran, Freeca, Galant, New Space Wagon

Nissan (China) Investment Co. 13/F, South Tower of Beijing Kerry Centre, No. 1 Guang Hua Road Chaoyang District, Beijing 100020, P.R. China (86) 10-8529-8181, www.nissan.com.cn Top executive: Kayashima Yukihisa, CEO

Nissan Motor Co. is counting on new Volkswagen Bora. models to fuel growth in 2008. The company Nissan also will be challenged to ensure expects sales to expand 27.9 percent to high-quality customer service amid the rapid 360,000 vehicles this year. growth. The automaker sees sales outlets The company is getting a boost from new growing to 340 this year from 300 in 2007. models such as the M35, which was Nissan is hoping to boost sales through a launched in January. The popular Qashqai new financing arm that it opened in January debuted in March. with its local partner, Dongfeng Motor Nissan and Infiniti each will launch two Group Co. The venture will give new-car more models in 2008, but Nissan won’t say NISSAN QASHQAI loans to Nissan and Infiniti customers across which. China as well as provide inventory financing A top challenge will be nurturing the models declined in sales. for dealers. Infiniti brand, introduced in China only last In December, the Tiida was the fourth- To make sure dealer performance is up to July. Luxury cars make up just 2.0 percent of best-selling model in China. snuff, Nissan also opened a 6,397-square- the local market, and Infiniti sales totaled a In other segments, Nissan is starting to feel meter (69,000-square-foot) training center at meager 1,500 units last year. pressure from increased competition. the Huadu plant last month. By contrast, the Nissan Tiida is enjoying Sales of the compact Sylphy nearly That center can instruct 500 sales associates strong momentum. Its sales rose 11.5 quadrupled to 57,182 units last year. But and mechanics at one time. Nissan invested percent to 123,310 last year despite being Nissan had to drop the price 9.0 percent to $3.1 million in the training center. in the subcompact segment, where 25 of 42 counter price cuts on the Mazda6 and — Hans Greimel

JV: Zhengzhou Nissan Automobile Co. JV: Dongfeng Motor Co./ Passenger No. 1405, East Hanghai Road, Zhengzhou Economic & Technical Zone Vehicle Co. Zhengzhou City, Henan Province 450016, P.R. China No. 8 Fengshen Road, Huadu, Guangzhou, (86) 371-6603-3666, www.zznissan.com.cn Guangdong Province 510800, P.R. China Top executive: Guo Zhenfu, general manager (86) 20-8687-0670, www.dongfeng-nissan.com Top executive: Mamoru Yoshida, general manager 2007 2006 Ownership: Capacity 60,000 60,000 Dongfeng Motor Co. 51% 2007 2006 Sunny, Teana, Tiida, Sylphy; Livina Geniss Production 10,258 7,795 Nissan Motor Co. 30% Capacity 360,000 360,000 Ownership: Unit sales 9,605 7,800 Zhengzhou Light Vehicle Co. 19% Production 273,898 201,251 Nissan (China) Investment Co. 50% Models produced: Nissan Paladin SUV Unit sales 271,915 203,537 Dongfeng Motor Group Co. 50% Models produced: Nissan Bluebird,

2008 GUIDE TO CHINA’S AUTO MARKET Automotive News • J.D. Power and Associates • Automotive Resources Asia 16 GLOBAL AUTOMAKERS/JOINT VENTURES

PSA Peugeot Citroen Group Beijing Office, Unit 416, 4th Floor, Tower A Beijing Kelun Building 12A Guanghualu, Chaoyang District, Beijing 100020, P.R. China (86) 10-6581-4158, www.psa.net.cn Top executive: Yves Boutin, chief representative

PSA/Peugeot-Citroen SA lagged the overall The company launched the Peugeot 307 Wuhan will begin production, and the first market last year. hatchback in February, about 1½ years after model will be the Citroen C5. With the new Sales of PSA vehicles in 2007 rose only 2.9 Ford launched the hot-selling Focus plant, PSA’s capacity in China will be 450,000 percent to 207,255 units, including imports hatchback. units. and sales of its joint venture in Wuhan, To catch up with the swiftly changing PSA continues its cost-cutting efforts. All its Dongfeng Peugeot Citroen Automobile Co. market, this year PSA plans to launch five models source more than 80 percent of their The China light-vehicle market grew 21.3 Peugeot and Citroen brand models based components in China, says the company. percent last year. on its existing platforms in China. The Last June, PSA and Hafei Motor Co. signed PSA was slow in rolling out new products. It company expects the new products will a memorandum of understanding to set up a launched only two redesigned models in boost sales 35.1 percent to 280,000 units in joint venture to assemble light commercial China in 2007: the redesigned Citroen Picasso 2008. vehicles in Shenzhen. and the Peugeot 307 three-box sedan. In 2009, the second assembly plant in — Lan Lan

JV: Dongfeng Peugeot Citroen Automobile Co. 2007 2006 Picasso, Xsara, Kaixuan (C-Triomphe); No. 165 Shenlong Ave. Capacity 220,000 150,000 Peugeot 206, 307 Wuhan Economic-Technological Development Area Production 213,058 201,858 Ownership: Wuhan City, Hubei Province 430056, P.R. China Unit sales 207,255 201,318 PSA Peugeot Citroen 50% (86) 27-8429-9882, www.dpca.com.cn Models produced: Dongfeng Motor Industry Top executive: Liu Weidong, general manager Citroen C2, Elysee, Fukang (ZX), Investment Co. 50%

Suzuki Motor Corp. Beijing Office Room 502, Beijing Fortune Building, No. 5 Dongsanhuan Bei Road Chaoyang District, Beijing 100004, P.R. China (86) 10-6590-8040, www.suzuki.com Top executive: Kunihisa Matsubara, general manager

Suzuki Motor Corp.’s aging lineup of Jiangxi Changhe Suzuki Automobile Co., rose inexpensive cars hobbled growth in 2007. 11.7 percent to 37,925 units last year. Sales of Suzuki brand sales grew just 1 percent last Suzuki’s other cars — the Swift, New Swift year to 161,066 domestically made cars, and Alto — dropped. compared with the overall industry’s 21.3 “Suzuki has only launched three new car percent increase. models in recent years and made a big “Suzuki has been in China for a long time mistake by using an old engine for its New with its low-end image,” says John Zeng, Swift,” Zeng says. senior market analyst at the Asian The automaker is expected to launch an Automotive Research division of Global updated version of the Alto this year. Alto Insight Inc. “Therefore, they have difficulty sales were down 18.7 percent to 31,930 in gaining market share in tier-one cities.” 2007. But Suzuki is trying to change that. Says Mei Songlin, China general manager In 2007, the automaker introduced a for J.D. Power and Associates: “To push up

hatchback version of its Tianyu SX4 sedan. SUZUKI TIANYU SX4 their sales in China, Suzuki has to launch In April, Suzuki also introduced two products in the mid-sized segment.” imported SUVs: the Jimmy and Grand Vitara. car will really help Suzuki’s volume in Suzuki primarily competes in small cars, A total of 21,379 Tianyu SX4 cars were sold China,” says Yale Zhang, director of which didn’t grow in 2007. in 2007. The hatchback model accounted for emerging markets at the CSM Worldwide Says Zeng of Global Insight: “Poor brand 80 percent of SX4 sales, says Yang De Ping of consulting firm. With all the changes at image” associated with the Alto “and slow Chongqing Automobile Co. Suzuki, Zhang is optimistic: “I don’t think product freshenings in China are the main The car’s sticker price starts at $13,233. they are in bad shape in China.” factors that drag Suzuki’s sales down.” “Suzuki’s hatchback SX4 is selling well. This Sales of the Wagon R, a made by — Namrita Chow

JV: Jiangxi Changhe Suzuki Automobile Co. JV: Chongqing Changan Suzuki Automobile Co. No. 1 East Road, Jindezhen City, Jiangxi Province 333002, P.R. China Yu Dong Town, Ba Nan District, Chongqing 401321, P.R. China (86) 798-8416-868, www.changhe-suzuki.com (86) 23-6628-8623, www.changansuzuki.com Top executive: Takeuchi Masahiro, general manager Top executive: Tosiaki Hasimoto, general manager 2007 2006 Ownership: 2007 2006 Ownership: Capacity 160,000 160,000 Changhe Group 51% Capacity 200,000 200,000 Co. 51% Production 47,470 56,000 Suzuki Motor Corp. 46% Production 107,624 112,565 Suzuki Motor Corp. 25% Unit sales 47,393 45,689 Okaya 3% Unit sales 108,239 112,097 Sojitz Corp. 14% Models produced: Bei Dou Xing Models produced: Suzuki Alto, Swift, Suzuki Motor Investment Co. 10% (Suzuki Wagon R+), Liana New Swift, Tianyu SX4

2008 GUIDE TO CHINA’S AUTO MARKET Automotive News • J.D. Power and Associates • Automotive Resources Asia GLOBAL AUTOMAKERS/JOINT VENTURES 17

Toyota Motor China Investment Co. Room 3806-11, Jin Guang Center, Hujialou, Chaoyang District, Beijing 100020, P.R. China (86) 10-6597-3995, www.toyota.com.cn Top executive: Isogai Masashi, general manager

Toyota Motor Corp. was a late bloomer in hybrid vehicles, struggled. China. But it is closing fast on the market In 2006, the joint venture sold just 4,858 leaders. vehicles. Sales dropped to 2,925 units last The company still trails Volkswagen AG year, reflecting Chinese disenchantment and General Motors in overall sales. But last with the pricey Prius. year it leapfrogged domestic rival Honda Prius sales tumbled 80.7 percent to a paltry Motor Co. to be the top Japanese brand in 414 vehicles in 2007. And the model could the country. get squeezed even further as Chinese Toyota now is eyeing a 53.8 percent sales manufacturers roll out cheaper hybrids of increase to 700,000 units this year on its way their own. to 1.0 million in the early 2010s. Sales Still, Toyota’s overall sales are expected to jumped 62.3 percent to 455,038 vehicles in get a big boost from an influx of fresh 2007. product. As a sign of Toyota’s ascent, the Camry was Lexus launched its top-of-the-line LX 570 the third-best-selling car in China last year. TOYOTA CAMRY SUV in January, just as SUV sales began to Looking ahead, Toyota will have to pick up in China. A redesigned subcompact navigate the pitfalls of quick expansion as it its Lexus luxury lineup. Vios appeared in February. Meanwhile, sets up new sales outlets and boosts By the end of January, Toyota had 469 sales Toyota will get positive spillover from production to meet demand. Japanese press outlets in China, up from 366 in November December’s launch of a refreshed Land reports are rife with speculation that the 2006. Lexus sales points, however, rose to 39, Cruiser. company will soon build an eighth assembly from just 13. Finally, a next-generation Yaris is expected plant in China. Plant 2 of Sichuan FAW Toyota Motor Co., around midyear. Toyota also will have to deepen the roots of which makes Land Cruiser SUVs and Prius — Hans Greimel

JV: FAW Toyota Motor Co. — Plant 1 JV: Sichuan FAW Toyota Motor Co. — Plant 1 No. 2, Liuli Road, Yang Liu Qing, Xiqing District, Tianjin 300380, P.R. China No. 9 Tiaodenhe South Road, Chenghua District, Chengdu City, (86) 22-2794-4050, www.tftm.com.cn Sichuan Province 610051, P.R. China Top executive: Masahiro Kato, general manager (86) 28-8471-7126, www.sftm.com.cn Top executive: Hoshino Haruaki, general manager 2007 2006 Models produced: Capacity 120,000 120,000 Toyota Corolla, Vios 2007 2006 Models produced: Production 106,449 116,445 Ownership: Capacity 13,000 10,000 Toyota Land Cruiser, Prado Unit sales 105,239 116,459 Toyota Motor Corp. 40% Production 10,952 6,139 Ownership: FAW Xiali Automobile Co. 30% Unit sales 11,028 6,077 FAW Group 50% First Auto Works 20% Toyota Motor Corp. 45% Toyota Motor Investment Co. 10% Toyota Tsusho Corp. 5%

Tianjin FAW Toyota Motor Co. — Plant 2 Sichuan FAW Toyota Motor Co. — Plant 2 No. 81 9th Ave., Tianjin Tai Da Economic-Technological Development Area No. 5 Dongfeng St., Changchun City, Jilin Province 130011, P.R. China Tianjin 300457, P.R. China (86) 431-5786-808, www.sftm.com.cn (86) 22-6623-0666, www.tftm.com.cn Top executive: Hoshino Haruaki, general manager Top executive: Masahiro Kato, general manager 2007 2006 Models produced: 2007 2006 Models produced: Capacity 10,000 10,000 Toyota Land Cruiser, Prius Capacity 120,000 100,000 Toyota Crown, Reiz Production 2,698 5,054 Ownership: Production 99,403 91,914 Ownership: Unit sales 2,925 4,858 FAW Group 50% Unit sales 99,410 91,776 Toyota Motor Corp. 40% Toyota Motor Corp. 45% FAW Xiali Automobile Co. 30% Toyota Tsusho Corp. 5% First Auto Works 20% Toyota Motor Investment Co. 10%

Tianjin FAW Toyota Motor Co. — Plant 3 JV: Guangzhou Toyota Motor Co. No. 81 9th Ave., Tianjin Tai Da Economic-Technological Development Area No. 8 Huangge Duan Huangge Zhen, Shi Nan Road Tianjin 300457, P.R. China Nansha Economic Development District, Guangzhou City (86) 22-6623-0666, www.tftm.com.cn Guangdong Province 511400, P.R. China Top executive: Masahiro Kato, general manager (86) 20-3939-8888 Top executive: Kuzuhara Toru, general manager 2007 2006 Models produced: Capacity 180,000 – Toyota Corolla, Ex 2007 2006 Ownership: Production 64,462 – Ownership: Capacity 200,000 200,000 Guangzhou Automobile Unit sales 63,999 – Toyota Motor Corp. 40% Production 170,277 61,281 Industry Group Co. 50% FAW Xiali Automobile Co. 30% Unit sales 170,294 61,254 Toyota Motor Corp. 50% First Auto Works 20% Models produced: Toyota Motor Investment Co. 10% Toyota Camry

2008 GUIDE TO CHINA’S AUTO MARKET Automotive News • J.D. Power and Associates • Automotive Resources Asia 18 GLOBAL AUTOMAKERS/JOINT VENTURES

Volkswagen China Investment Co. 3A Sanlitun Road, Chaoyang District, Beijing 100027, P.R. China (86) 10-6505-3232, www.volkswagen.com.cn Top executive: Winfried Vahland, president and CEO

Despite tough competition from General Investment Co. began offering new models. would design the interior and exterior of a Motors, Toyota and surging Chinese brands, In June, it introduced the Skoda brand to car aimed at North America and China. Volkswagen AG extended its lead in China’s China with the launch of the Octavia. VW began to see results in 2007 from a car market in 2007. VW wants Skoda to be its volume brand in 2005 restructuring aimed at, among other Rolling out fresh models with new China, and Skoda models will start at lower things, cost reduction through centralized technology and improving its image with prices than Volkswagen or Audi cars. The purchasing and increased localization. Chinese consumers helped VW boost its Octavia started well, selling nearly 32,000 VW also improved customer service in share to 17.5 percent at the end of 2007, up units in six months. China last year. Shanghai Volkswagen and 1.6 percentage points from 2006, according VW has beefed up its r&d capability in FAW-VW boosted their scores on the J.D. to Automotive Resources Asia. China. For example, in 2007 it announced Power customer satisfaction survey. Last summer, Volkswagen China that Shanghai Volkswagen Automotive Co. — Alysha Webb

JV: FAW-Volkswagen Automotive Co. JV: Shanghai Volkswagen Automotive Co. Dongfeng Street, Changchun, Jilin Province 130011, P.R. China No. 63, Luo Pu Road, An Ting, Jiading Distict, Shanghai 201805, P.R. China (86) 431-5990-151, www.faw-volkswagen.com (86) 21-5956-1888, www.csvw.com Top executive: An Tiecheng, president Top executive: Chen Zhixin, general manager

2007 2006 Ownership: 2007 2006 Ownership: Capacity 660,000 450,000 China FAW Group Corp. 60% Capacity 450,000 450,000 Shanghai Automotive Industry Corp. 50% Production 490,000 346,787 Volkswagen AG 20% Production 466,139 350,630 Volkswagen AG 40% Unit sales 469,169 345,318 Volkswagen Investment Co. 10% Unit sales 456,424 349,088 Volkswagen Investment Co. 10% Models produced: Audi A4, A6; Audi AG 10% Models produced: VW Passat, Touran, VW Bora, Caddy, Golf, Magotan, , Passat Lingyu, Polo, Santana, Sagitar Santana 3000, Skoda Octavia

2008 GUIDE TO CHINA’S AUTO MARKET Automotive News • J.D. Power and Associates • Automotive Resources Asia AN AUTONEWS 04-14-08 D 19 AUTONEWS 4/9/2008 3:31 PM Page 1

PRODUCTION FACILITIES IN CHINA 19

13 Heilongjiang

Jilin 22 MONGOLIA 23 AN 3

Inner Mongolia Liaoning 8

6 1 Xinjiang 17 2 Beijing 13 20 Tianjin Hebei 5 15 14 12 Ningxia 9 CHINA Shandong Shanxi Qinghai Jiangsu Gansu 9 16 14 Anhui 3 Shaanxi Henan JAPAN 7 21 Xizang 8 6 24 Shanghai Hubei 17 11 4 2 11 21 18 NEPAL Zhejiang Sichuan 19Chongqing 10 18 20 19 15 Guizhou Hunan 5 Fujian Jiangxi 27 16 1 12 Yunnan 26 7 10 25 Taiwan Guangxi Guangdong Hong Kong VIETNAM MYANMAR LAOS 4 PHILIPPINES Hainan Global automakers/Joint ventures Domestic automakers 1 - BMW Brilliance Automotive Ltd. 14 - Dongfeng Yueda Kia Automobile Co. 1 - Co. 12 - Great Wall Motor Co. Shenyang, Liaoning Province Yangcheng, Jiangsu Province Liuzhou, Guangxi Province Baoding, Hebei Province 2 - Beijing Benz-DaimlerChrysler 15 - Hunan Changfeng Motor Co. 2 - Dongfeng Automobile Co. 13 - Hafei Motor Co. Automotive Co. Changsha, Hunan Province Xiangfan, Hubei Province Harbin, Heilongjiang Province Beijing 16 - Zhengzhou Nissan Automobile Co. 3 - FAW Car Co. 14 - Hebei Zhongxing Automobile Co. 3 - Nanjing Fiat Auto Co. Zhengzhou, Henan Province Nanjing, Jiangsu Province 17 - Dongfeng Peugeot Citroen Automobile Co. Changchun, Jilin Province Baoding, Hebei Province 4 - Changan Ford Mazda Automobile Co. Wuhan, Hubei Province 4 - FAW Co. 15 - Rongcheng Huatai Automobile Co. Chongqing 18 - Chongqing Changan Suzuki Haikou, Hainan Province Rongcheng, Shandong Province 5 - Jiangling Motors Corp. Automobile Co. 5 - Tianjin FAW Xiali Automobile Co. 16 - Jiangxi Jiangling Holding Co. Nanchang, Jiangxi Province Chongqing Tianjin Nanchang, Jiangxi Province 6 - Shanghai GM (Shenyang) 19 - Jiangxi Changhe Suzuki Automobile Co. 6 - Chery Automobile Co. 17 - Beijing Automobile Works Co. Norsom Motors Co. Jindezhen, Jiangxi Province Wuhu, Anhui Province Beijing Shenyang, Liaoning Province 20 - Tianjin FAW Toyota Motor Co. 7 - Anhui Jianghuai Automobile Co. 18 - Chongqing Changan Automobile Co. 7 - SAIC-GM-Wuling Automobile Co. Tianjin Liuzhou, Guangxi Province 21 - Sichuan FAW Toyota Motor Co. Hefei, Anhui Province Chongqing 8 - Shanghai General Motors Corp. Chengdu, Sichuan Province 8 - Shenyang Brilliance Jinbei 19 - Chongqing Lifan Automobile Co. Shanghai 22 - Sichuan FAW Toyota Motor Co. Automotive Co. Chongqing 9 - Shanghai GM Dongyue Motors Co. Changchun, Jilin Province Shenyang, Liaoning Province 20 - Hunan Jiang Nan Automobile Co. Yantai, Shandong Province 23 - FAW-Volkswagen Automotive Co. 9 - BYD Auto Co. Xiangtan, Hunan Province 10 - Guangzhou Honda Automobile Co. Changchun, Jilin Province Xian, Shaanxi Province 21 - SAIC Motor Manufacturing Co. Guangzhou, Guangdong Province 24 - Shanghai Volkswagen Automotive Co. 10 - Jiangxi Changhe Automobile Co. Shanghai 11 - Dongfeng Honda Automobile Shanghai Jing De Zhen, Jiangxi Province (Wuhan) Co. 25 - Dongfeng Nissan Passenger Vehicle Co. Wuhan, Hubei Province Guangzhou, Guangdong Province 11 - Zhejiang Geely Automobile Group 12 - Honda Automobile (China) Co. 26 - Guangzhou Toyota Motor Co. Hangzhou, Zhejiang Province Guangzhou, Guangdong Province Guangzhou, Guangdong Province 13 - Beijing Hyundai Motor Co. 27 - Soueast (Fujian) Motor Co. Beijing Fuzhou, Fujian Province

2008 GUIDE TO CHINA’S AUTO MARKET Automotive News • J.D. Power and Associates • Automotive Resources Asia 20 DOMESTIC AUTOMAKERS Domestic brands claim largest share of market Despite competition from international CHINESE BRANDS GRAB SHARE government will continue to force ailing brands, domestic carmakers sold the most state-owned automakers into the arms of passenger vehicles in China in 2007. Domestic brands sold the largest number of healthy ones. Thanks to a wave of new models from such passenger vehicles in China in 2007, followed by Domestic automakers continue to source automakers as Chery Automobile Co. and Japanese brands. low-priced auto parts from Chinese BYD Auto Co., domestic brands grabbed 28.7 BRANDS 2007 SHARE 2006 SHARE suppliers to reduce their costs. International percent of the market last year. Japanese Domestic 28.7% 27.7% auto giants, such as General Motors and brands were second with 28.3 percent, Japanese 28.3% 24.9% Volkswagen AG, are following the same according to Automotive Resources Asia, a European 22.6% 24.1% strategy. Increasingly they are localizing unit of J.D. Power and Associates. U.S. 13.6% 13.5% advanced components parts, such as some Chery was the No. 1 domestic automaker. Korean 6.8% 9.7% parts, in China. It sold 369,459 units in 2007, up 22.1 percent To avoid the intense competition in the Source: Automotive Resources Asia Ltd. from 2006. It was followed by Zhejiang Geely domestic market, Chinese automakers Automobile Group, at 219,513 units, and stepped up efforts to export to the Middle FAW Xiali, at 180,280. the Chinese government to make cars at the East, North Africa, the former Soviet bloc With global automakers dominating the end of 2007. and Southeast Asia. Chery, the largest mid-sized and large segments, domestic With China’s automotive sector becoming exporter among domestic auto auto manufacturers concentrated on small increasingly crowded, the long-anticipated manufacturers, exported more than 118,000 and inexpensive models. Their cars typically consolidation finally got under way. vehicles in 2007. were priced between $4,500 and $14,000. In December 2007, Shanghai Automotive While the domestic automakers are Prodded by China’s government, large Industry Corp. acquired Nanjing Automobile progressing, many are still years away from domestic automakers are launching their own (Group) Corp. after the latter came under making high-quality cars that can compete brands. For instance, Dongfeng Motor Co. tremendous financial pressure following its effectively in Europe and the United States. launched its first car, a small wagon, in purchase of the MG brand and Rover’s But Shenyang Brilliance Jinbei Automotive October, while Guangzhou Automobile Group plant in England. Co. is trying to build sales this year in Europe Co. displayed three concept cars in November. Both SAIC and Nanjing Auto are state- after it reworked its BS6 sedan, which failed The industry also is attracting new players. owned enterprises. The Chinese government crash tests last year. Chery is proceeding with Bird Co., a mobile phone handset was seen playing an active role in brokering plans to build a U.S. car for Chrysler LLC. manufacturer, finally secured a license from the deal. Industry observers believe the — Yang Jian

Beijing Automotive Industry Holding Corp. Global JVs No. 25, Dong San Huan South Road, Chaoyang District Beijing Benz-DaimlerChrysler Automotive Co. – Beijing – Mitsubishi Outlander; Beijing 100021, P.R. China Chrysler 300C; Mercedes-Benz E class (Page 8) (86) 10-6769-9888 Beijing Hyundai Motor Co. – Beijing – Hyundai Sonata, Elantra,Tucson, NF, Verna (Page 13) Top executive: Xu Heyi, chairman

Beijing Automotive Industry Holding A bright spot for Xu in BAIC’s operations is is expected to unveil more models at the Corp.’s 2007 performance was disappointing. commercial vehicles. Selling more than 2008 Beijing auto show. Industry sources Now, Chairman Xu Heyi is stepping up 400,000 vehicles, Beiqi Foton was China’s say the vehicles are mainly derived from efforts to revive the state-owned automaker’s largest commercial-vehicle maker in 2007. previous generations of the Hyundai passenger-vehicle business. To reinvigorate its passenger-vehicle Sonata. Neither of BAIC’s two joint ventures, with business, BAIC in late 2007 set up a holding After coming on board in late 2006 as Hyundai Motor Co. and DaimlerChrysler AG, company, Beijing Hainachuan Automotive BAIC’s chairman, Xu, a former Beijing did well in 2007. Parts Co., for its 12 in-house suppliers, municipal government official, has mapped Beijing Hyundai Motor Co.’s sales slumped including its joint ventures with Delphi out ambitious plans to rebuild BAIC. 20.3 percent to 231,137 units in 2007. Sales Corp., Johnson Controls Inc., Visteon Corp. In February this year, BAIC hired Wang of the once hot-selling Hyundai Elantra and BorgWarner Inc. Dazong away from Shanghai Automotive dropped 29.1 percent to 120,333 units, while BAIC hopes that the holding company can Industry Corp. to be its general manager. Hyundai Sonata sales declined 31.2 percent boost the variety and quality of parts Wang was trained in the United States and to 25,528 units. supplied to its joint ventures and its own- will be put in charge of developing BAIC’s Sales of Beijing Benz-DaimlerChrysler brand vehicles. own brand. Automotive Co. dropped from the previous Beijing Hyundai sources a large portion of BAIC aims to sell 1 million vehicles in 2008 year to 19,730 units in 2007. For contrast, its components from Korea. Beijing Benz- and 2 million in 2010, including cars, SUVs Daimler’s rival BMW boosted sales of its DaimlerChrysler also relies heavily on and commercial vehicles. These are joint venture with Brilliance China imported parts. Localizing parts will reduce challenging targets for an automaker that Automotive Holding Ltd. to 32,249 units last costs. sold fewer than 700,000 vehicles in 2007. year. BAIC unveiled its own brand last year. It — Lan Lan

Beijing Automobile Works Co. No. 51, Fangjiacun, Guangqu East Road, Chaoyang District 2007 2006 Models produced: Luba, Suwei, Sujun, Beijing 100022, P.R. China Capacity 100,000 100,000 Zhanqi, Xuanfeng, Leichi (86) 10-8774-3332, www..com.cn Production 11,190 2,759 Ownership: Top executive: Yao Changsheng, president Unit sales 11,343 2,892 Bejing Automotive Industry Corp. 100%

2008 GUIDE TO CHINA’S AUTO MARKET Automotive News • J.D. Power and Associates • Automotive Resources Asia 22 DOMESTIC AUTOMAKERS

Shenyang Brilliance Jinbei Automotive Co. 2007 2006 Ownership: No. 39, Dongwang Street, Dadong District, Capacity 145,000 140,000 Brilliance Automobile Holdings 51% Shenyang City, Liaoning Province 110044, P.R. China Production 125,313 73,999 JinBei Automobile Co. 39% (86) 24-3166-6666, www.brilliance-auto.com.cn Unit sales 114,317 73,057 Dalian Huaxia North Investment Co. 10% Top executive: Qi Yumin, president Models produced: Splendor, Junjie, Zunchi

Shenyang Brilliance Jinbei Automotive Co. Brilliance needs more new products to fuel rolled out its first passenger vehicle in 2000. growth, but the company has yet to But eight years later the automaker has only announce new models. three models. Despite its modest sales in China, The automaker’s major challenge for the Brilliance is trying to export to Europe. next few years is to boost r&d and add Last year it suffered a setback when the products. BS6 received only one star, the worst rating, Brilliance was established as a state- in the European New Car Assessment

owned light-bus manufacturer in Shenyang BRILLIANCE SPLENDOR, OR BS4 Program. City in Liaoning Province in 1991. It started Brilliance has redesigned 65 parts of the to produce the Zhonghua sedan in 2000. But Brilliance now produces three models, BS6 and plans to bring the improved cars to the company was distracted by frequent the Zunchi (also called the BS6), the Europe again this summer. reshufflings of top executives from 2001 to Splendor (also called the BS4) and the Brilliance also partners with BMW. Their 2006 because of an ownership dispute Junjie. joint venture in Shenyang produced 32,249 between the Liaoning provincial The company sold 32,006 Zunchis and BMW 3-series and 5-series sedans last year, government and the company’s founder, 82,311 Splendors in 2007, growing by 81.5 up 35.9 percent from 2006. . percent compared with 2006. — Kevin Huang

BYD Auto Co. No. 2 Yadi Road, Xinxing Industry Garden 2007 2006 Models produced: High-Tech Industrial Development Zone Capacity 200,000 80,000 Flyer, F3 Xian City, Shaanxi Province 710119, P.R. China Production 96,368 60,135 Ownership: (86) 29-8888-9999, www.bydauto.com.cn Unit sales 94,683 60,116 BYD Co. 99% Shaanxi Investment Group 1% Top executive: Wang Chuanfu, president

BYD Auto Co. plans to rely on electrics and scheduled to arrive in showrooms in 2009. The company wants to start volume hybrids to become an important automaker In 2003, BYD entered the auto industry and exports to top markets as early as the second in China. started to make standard gasoline-powered half of this year or early 2009. BYD Auto Its parent, BYD Co., is the largest autos. Sales reached 94,683 in 2007, a 57.5 showed vehicles at the Detroit auto show in manufacturer of rechargeable lithium ion percent increase over 2006. January and the Geneva show in March. batteries in China. Preferential policies would help BYD build BYD exported about 10,000 gasoline- BYD Auto plans to start selling its first sales of hybrids and electrics. But so far, the powered cars in 2007, mainly to Russia and plug-in hybrid car, the F6DM, in the second Chinese government has not adopted the Middle East. half of 2008. Its first electric-powered car is incentives. — Kevin Huang

Chongqing Changan Automobile Co. No. 260 Jian Xin East Road, Jiang Bei District 2007 2006 Ownership: Capacity 150,000 150,000 Nanfang Industrial Automobile Co. 54% Chongqing 400023, P.R. China Production 60,516 19,212 Public shares 46% (86) 23-6759-0114, www.changan.com.cn Unit sales 55,515 17,974 Top executive: Yin Jiaxu, president Models produced: CM8, Jiexun Benben

Chongqing Changan Automobile Co. has to establish high-quality larger vehicles. The first Changan brand vehicles to market joined the rush by Chinese automakers to Changan, with headquarters in the were the Benben small car in late 2006 and develop their own brands. southwest China city of Chongqing, sold the Joice seven-seat wagon in 2007. Earlier The company plans to develop seven about 360,000 small and small pickups this year, Changan launched the CV8 sedan. sedan platforms in the coming three years to in 2007. It plans to sell 450,000 units this With partner Jiangling Motors Corp., bring more models of its own brands to year. Changan also launched another seven-seat market. The company used to be China’s leading wagon, the Fengshang, in 2006 and the Many Chinese still regard Changan as only small-van maker but was overtaken by Fenghua small sedan in 2007. The two cars a small-car manufacturer, so the company’s General Motors’ joint venture, SAIC-GM- carry Jiangling’s badge. major challenge in the coming years will be Wuling Automobile Co. — Kevin Huang

Domestic JV: Jiangxi Jiangling Holding Co. 2007 2006 Ownership: No. 99 Liantan Town, North Denghu Road, Nanchang City Capacity 50,000 60,000 Chongqing Changan Jiangxi Province 330200, P.R. China Production 9,820 14,509 Automobile Co. 50% (86) 791-5216-666, www.landwind.com Unit sales 16,323 14,070 Jiangling Motors Co. 50% Top executive: Lu Shuifang, general manager Models produced: Landwind, Baowei, Fengshang

2008 GUIDE TO CHINA’S AUTO MARKET Automotive News • J.D. Power and Associates • Automotive Resources Asia DOMESTIC AUTOMAKERS 23

Chery Automobile Co. 2007 2006 Models produced: No. 8 Changchun Road, Economic-Technological Development Area Capacity 530,000 350,000 QQ, A520, Easter, New Qiyun, Wuhu City, Anhui Province 241009, P.R. China Production 387,312 307,232 Tiggo, Easter Cross, V2, (86) 553-5923-805, www.chery.cn Unit sales 369,459 302,478 Ownership: Top executive: Yin Tongyao, president & general manager Chery Automobile Co. 100%

Chery Automobile Co. dreams of selling plant in Wuhu. The plant boosts Chery’s vehicles in North America and Europe. But annual capacity by 300,000, to 700,000 first it needs to make its cars safe and vehicles. reliable and rid itself of a cheap-car image. Including exports, Chery’s sales reached Slower growth should give Chery breathing 489,259 units in 2007, just shy of Shanghai room to change. Chery grew by 22.1 percent General Motors’ domestic sales in China. in 2007, well below its 57.6 percent growth in By working with experienced global 2006. automakers such as Chrysler LLC and Fiat “Chery already has a certain volume. That Auto S.p.A., Chery is further strengthening gives them time to really slow down,” says its operations. Yale Zhang, director of emerging markets Phil Murtaugh, Chrysler’s Asia chief, says vehicle forecasts at CSM Worldwide. “Now Chrysler’s deal with Chery is a “25-year, Chery is turning its attention to issues of broad, long-term strategic cooperation.” strategy, marketing and quality.” For Chrysler, Chery will produce a small Yin Tongyao, Chery’s president, says that sourcing more and more from global car for South America by mid-2008. Chery quality, not quantity, is Chery’s main focus. suppliers.” declines to comment on the expected date “North America and Europe have very Global suppliers, of course, are keen to for entry into North America. tough and demanding safety and emission take advantage of Chery’s anticipated growth For Fiat, Chery is expected to assemble kits laws that our vehicles do not represent yet,” and have flocked to Chery’s hometown, of the Linea, Grande Punto and Alfa 159 Yin says. “Overall, the quality of the Chinese Wuhu. ArvinMeritor Inc., Tower Automotive beginning in early 2009. Full localized supply base is improving, but it is not as LLC and Johnson Controls Inc. have joint production of the three cars is expected to good as it should be.” ventures with Chery in Wuhu. begin in late 2009. To improve quality, says Yin, “Chery is In late 2007 Chery opened its third car — Namrita Chow 24 DOMESTIC AUTOMAKERS

China FAW Group Corp. No. 821 Dongfeng St., Changchun Jilin Province 130011, P.R. China (86) 431-8765-5827, www.faw.com.cn 2008 Guide to Top executive: Zhu Yanfeng, general manager China’s Auto Market Staff China FAW Group Corp., China’s second-largest domestic automaker, Editors: Charles Child, wants to build momentum with its Mary Raetz own brand in 2008. Correspondents: Sales of FAW’s Besturn brand, Gary Anglebrandt, which means “best turn,” reached Namrita Chow, 23,279 in 2007 from 4,230 in 2006. Kevin Huang, Lan Lan, Besturn competes with the Buick Alysha Webb, Yang Jian Regal and Ford Mondeo. Few Production: Terry Driscoll, domestic models are competing in Larry Williams the mid-sized sedan segment. Sales of the Red Flag brand, well Keith E. Crain known for transporting high Publisher and Editor-in-Chief government officials, slid 41.3 Peter Brown percent to 2,584 units. FAW faces a Associate Publisher difficult challenge to attract and Editorial Director mainstream customers to the David Sedgwick historic brand. Red Flag cars Editor, Automotive News mainly are used for government Editorial staff Charles Child purposes. FAW BESTURN A new three-box sedan similar to E-mail: [email protected] the Volkswagen Jetta will debut by 35.9 percent to 469,169 units. The Phone: (313) 446-0365 Global JVs: Fax: (313) 446-0383 year end, and a bevy of new models hot-selling VW Jetta posted sales of Tianjin FAW Toyota Motor Co. – Tianjin – Larry Schlagheck including a small sedan and an SUV Toyota Vios, Corolla, New Corolla, Crown, Reiz 201,131 units. FAW also has started are being developed, say FAW producing the Jetta in its Chengdu Advertising Director (Page 17) [email protected] sources. FAW is studying how to sell Sichuan FAW Toyota Motor Co. – Chengdu, plant, with current capacity of Phone: (313) 446-6790 the new models under its two Sichuan Province; Changchun, Jilin Province – 50,000 units. brands, Red Flag and Besturn. Toyota Land Cruiser, Prado, Prius (Page 17) Sales of FAW’s joint venture with autonews.com FAW plans to expand its product Toyota, Tianjin FAW Toyota Motor John FItzgerald FAW-Volkswagen Automotive Co. – Director of Business Planning lineup from small cars to luxury Changchun, Jilin Province – Audi A4, A6; VW Co., rose 29 percent to 268,648 units and Online Commerce cars on four platforms under Jetta, Bora, Sagitar, Golf, Magotan, Caddy in 2007. The venture is expected to [email protected] development. The automaker said it (Page 18) build its fourth assembly plant, in Phone: (313) 446-1679 will spend $1.83 billion to develop Changchun, with capacity SUBSCRIPTIONS new vehicles through 2015, platform, and the Red Flag HQ3 is estimated at 100,000 units per year. [email protected] including cars and commercial based on Toyota’s Majesta platform. That will bring the venture’s total Phone: (888) 446-1422 vehicles. A staff of 1,600 engineers Despite its efforts to develop new capacity to about 520,000 units a (U.S. & Canada) works in its r&d center in vehicles, FAW is widely regarded as year. (313) 446-1662 (all other locations) Changchun. a slow-moving state-owned FAW says it will become the first U.S. 1 year, $155; 2 years, $266, FAW shares resources and automaker, particularly compared Chinese automaker to operate a Canada $239 (U.S.); technologies with its joint-venture with such domestic rivals as plant in Mexico. It set up a joint other countries, $395, partners, Toyota Motor Corp. and Shanghai Automotive Industry venture with a local partner to Single copy sales, $5 per issue Volkswagen AG. It also makes Corp. and Chery Automobile Co. produce two FAW-badged small plus shipping Mazda cars under an agreement But FAW’s joint ventures enjoyed cars for Mexico and Central with the Japanese automaker. The a good year in 2007. FAW- America by 2010. CRAIN Besturn is based on the Mazda6 Volkswagen sales last year climbed — Lan Lan COMMUNICATIONS INC.

Keith E. Crain Rance Crain Domestic JV: FAW Car Co. 2007 2006 Ownership: Chairman President No. 4888 Weishan Road, High Technology Capacity 100,000 100,000 China FAW Group Corp. 64% M.K. Crain M.P. Crain Development Zone, Changchun City, Jilin Production 82,665 57,804 Public shares 36% Treasurer Secretary Province 130012, P.R. China Unit sales 81,947 56,613 Robert C. Adams (86) 431-8578-1576, www.fawcar.com.cn Models produced: Red Flag, Mazda6, Group Vice President/ Technology, Manufacturing, Top executive: Zhang Pijie, general manager Besturn Circulation WIlliam A. Morrow Domestic JV: Tianjin FAW Xiali 2007 2006 Ownership: Executive Vice Automobile Co. Capacity 200,000 200,000 China FAW Group Corp. 51% President, Operations Lilou Nan, Zhong Bei Xie Xiang, Xiqing District Production 183,651 202,000 Tianjin Automotive G.D. Crain Jr. Tianjin Province 300380, P.R. China Unit sales 180,280 197,000 Industry Corp. 34% Founder (1885-1973) (86) 22-8791-5000, www.tjfaw.com.cn Models produced: Charade, Vizi, Public shares 15% Mrs. G.D. Crain Jr. Top executive: Wang Gang, general manager Vela, Weizhi Chairman (1911-1996)

2008 GUIDE TO CHINA’S AUTO MARKET Automotive News • J.D. Power and Associates • Automotive Resources Asia DOMESTIC AUTOMAKERS 25

Dongfeng Motor Corp. No. 1 Dongfeng Ave., Wuhan Economic-Technological Development Area Wuhan City, Hubei Province 430056, P.R. China (86) 27-8428-5000, www.dfmc.com.cn Top executive: Xu Ping, general manager

In the United States, it would be called teaching the elephant to dance. Dongfeng Motor Corp., a large state-owned automaker, wants to build its own brand of light-duty vehicles. Most of Dongfeng’s vehicles are trucks and commercial buses. Dongfeng is building an r&d center and a plant in Wuhan to develop passenger vehicles, with a total investment of about $1.33 billion. The plant, scheduled to start mass production in early 2009, will have an annual capacity of 160,000 vehicles. Capacity will be expanded to about 330,000 with the second stage, which is scheduled to start construction in 2010. The automaker says the Wuhan plant mainly will produce mid-sized, large and luxury passenger vehicles. Dongfeng also is acquiring other Chinese automakers to build its brands. The company will take over Hafei Automobile Group and Dongan Auto Engine Co. in the first half of this year. The two companies now are subsidiaries of China Aviation Industry Corp. DONGFENG JINGYI Hafei, of Haerbin City, is a minivan and small-car manufacturer that sold about expect to increase capacity to 200,000 units. duty vehicles, Dongfeng also must keep 240,000 vehicles last year. Dongan mainly The minicars will have engines with good relations with all of its foreign produces small transmissions and 1.0- to displacements ranging from 0.8 liters to 1.3 partners: PSA/Peugeot-Citroen SA, Nissan 1.3-liter engines. liters. Motor Co., Honda Motor Co. and Kia Motors China Aviation will transfer control of the At affiliated plants in Liuzhou and Corp. two subsidiaries by setting up a joint Zhengzhou, Dongfeng Motor produces a Here are the 2007 sales of Dongfeng venture with Dongfeng. small number of pickups, SUVs and seven- Motor’s joint ventures with global Also, Dongfeng will increase production of seat vans. Total output was about 23,000 automakers: Dongfeng-badged minicars at Dongfeng units last year. ■ Dongfeng Nissan Passenger Vehicle Co.: YuAn Vehicle Co. in Shiyan City, Hubei Dongfeng can rapidly boost production 271,915, up 33.6 percent year on year. province, this year. capacity of its own brand of cars in the ■ Dongfeng Peugeot Citroen Automobile Dongfeng YuAn is a joint venture of coming years. But can it market the Co.: 207,255, up 2.9 percent. Dongfeng Motor and Chongqing’s YuAn vehicles? The company mainly has ■ Dongfeng Honda Automobile Co.: Group, which produces components and produced commercial vehicles, which 127,086, up 100.5 percent. motorcycles. largely depend on business-to-business ■ Dongfeng Yueda Kia Automobile Co.: Annual capacity for the minicars is 100,000 relationships, not marketing skills, to sell. 101,427, down 11.8 percent. units initially. Eventually, the partners Besides establishing its own brand of light- — Kevin Huang

Domestic JV: Dongfeng Liuzhou Motor Co. Global JVs: No. 286 Pingshan Ave., Liuzhou City Dongfeng Honda Automobile Co. – Wuhan, Hubei Province – Honda CR-V, Guangxi Province 545005, P.R. China Civic (Page 13) (86) 772-3281-218, www.fxauto.com.cn Dongfeng Yueda Kia Automobile Co. – Yancheng City, Jiangsu Province – Kia Top executive: Cheng Daoran, general manager Carnival, Optima, Cerato, Rio, Sportage, Accent (Page 13) 2007 2006 Ownership: Dongfeng Motor Co./Dongfeng Nissan Passenger Vehicle Co. – Guangzhou, Capacity 40,000 40,000 Dongfeng Motor Co. 75% Guangdong Province – Nissan Bluebird, Bluebird Sylphy, Geniss, Livina Production 19,266 19,237 Liuzhou Industrial Holding Co. 25% Geniss, Tiida, Teana, Sunny (Page 14) Unit sales 22,341 18,818 Dongfeng Peugeot Citroen Automobile Co. – Wuhan, Hubei Province – Models produced: Dongfeng Future, Citroen Fukang (ZX), C2, Elysee, Picasso, Kaixuan (C-Triomphe), Joyear Peugeot 206, 307 (Page 16) Zhengzhou Nissan Automobile Co. – Zhengzhou, Henan Province – Nissan Paladin (Page 14)

2008 GUIDE TO CHINA’S AUTO MARKET Automotive News • J.D. Power and Associates • Automotive Resources Asia 26 DOMESTIC AUTOMAKERS

Zhejiang Geely Automobile Group No. 1760 Jiangling Road, Binjiang District, Hangzhou City 2007 2006 Models produced: Ownership: Zhejiang Province 310051, P.R. China Capacity 300,000 300,000 Haoqing, Merrie, King Kong, 72.7% (86) 571-8776-6666, www.geely.com Production 195,336 180,214 Vision, Freedom Ship Others 27.3% Top executive: Li Shufu, chairman Unit sales 184,176 176,320

Zhejiang Geely Automobile Group wants to in Zhejiang province. jump-start growth in 2008. Last year Geely opened contract Geely sales grew by a mere 7.0 percent in manufacturing bases in , Russia 2007, well below the 35.1 percent increase in and Ukraine. This year, Geely says it will 2006 for China’s auto industry. build a plant in Mexico. The expected annual In 2007, Geely launched six redesigned total capacity of the Mexico plant is 300,000 vehicles. Geely plans four new launches in units. 2008: the China Dragon sporty car, King “The plant will serve all of North, South Kong hatchback, LC-1 economy hatchback and Central America,” says Li Shufu, Geely and TX4 taxi. chairman and founder. In the next five years, Geely says it has In 2006 Geely said it wanted to enter North plans for 15 new models, including a hybrid. America in 2008. But the company has since The automaker’s plans are so ambitious revised its strategy. “Entering a market that some analysts doubt it can pull them GEELY KING KONG depends on preparation,” Li says. off. In 2007 Geely bought a 23 percent stake in “It will be very difficult for them to launch 184,176 cars in China and exported 29,063 Great Britain taxi maker Manganese Bronze all these planned models, as there is still cars in 2007. Another 35,337 cars were made Holdings LLC. Geely also formed a joint limited brand reception for Geely in the by subsidiary brand Maple. venture with Manganese Bronze to produce domestic market,” says John Zeng, senior To realize its growth plans, Geely must the London Taxi in China. The TX4 model market analyst for Asian automotive increase production capacity. Four new will begin production this year with 1,000 research at Global Insight Inc. “It will take a plants are expected to start production by vehicles expected in its first year. long time for Geely to build a decent year end. The plants will push Geely’s annual Shanghai London Taxi International Co.’s image.” capacity to 500,000 units, up from the production is based at Shanghai Maple Nevertheless, Zhejiang Geely Automobile current 350,000. Automobile Co.’s operations in Jinshan Group says it plans to sell 230,000 vehicles in The new plants in Xiangtan, Jinan, District, Shanghai. 2008, up 25.9 percent from 2007. Geely sold Lanzhou and Cixi are outside Geely’s home — Namrita Chow

Shanghai Maple Automobile Co. 2007 2006 Models produced: Haiyu, Haixun, Haishang, Haifeng, Haiyue Fengling Industrial Zone, , Capacity 50,000 50,000 Shanghai City, P.R. China Production 31,997 29,866 Ownership: (86) 21-5136-9990, www.c-sma.com Unit sales 35,337 28,803 Zhejiang Geely Automobile Top executive: Jinliang Liu, general manager Holdings Group 90% Zhejiang Huapu Investment Co. 10%

Great Wall Motor Co. 2007 2006 Models produced: Ownership: No. 2266 South of Chaoyang Road, Baoding City Capacity 170,000 170,000 Hover, Safe, Sing Baoding Woerte 35% Hebei Province 071000, P.R. China Production 67,186 39,566 Baoding Municipal Unit sales 64,732 40,062 Government 24% (86) 321-2197-855, www.gwm.com.cn H Shares 38% Top executive: Wang Fengying, president Other 3%

In 2008, the challenge facing SUV maker Great Wall Motor Co. is to gain ground in cars. Great Wall received government approval to manufacture cars in late 2007. It launched its first small car, the Gwperi, in February. With a starting retail price of about $6,200, the Gwperi will compete against the Chery QQ and Changan Benben. In addition, Great Wall has developed other new cars, including the Florid, Coolbear and i7. In 2007, Great Wall’s domestic sales rose 61.6 percent to 64,732 units and exports totaled 51,394 units. The domestic growth GREAT WALL GWPERI GREAT WALL HOVER came mainly from the Hover, the top-selling SUV in China with sales of 57,752. Close overseas. The Baoding automaker has Chairman Wei Jianjun said late last year. behind was the with sales of exported to more than 120 countries. Great Wall started selling the Hover in 50,102. Great Wall plans to launch all of its vehicles and Romania. Great Wall has ambitious plans for in Europe in the second half of 2008, — Lan Lan

2008 GUIDE TO CHINA’S AUTO MARKET Automotive News • J.D. Power and Associates • Automotive Resources Asia 28 DOMESTIC AUTOMAKERS

Guangzhou Automobile Industry Group Global JVs: Floor 19-23, Chengyue Mansion, No. 448 Middle of Dongfeng Road Guangzhou Honda Automobile Co. – Guangzhou, Guangdong Province – Honda Accord, Fit, City, Odyssey (Page 13) Guangzhou City, Guangdong Province 510030, P.R. China Honda Automobile (China) Co. – Guangzhou, Guangdong Province – (86) 20-8315-0411, www.gaig.com.cn Honda Jazz (Page 13) Top executive: Zhang Fangyou, president Guangzhou Toyota Motor Co. – Guangzhou, Guangdong Province – Toyota Camry (Page 17)

At the end of 2007, Guangzhou Automobile model, a mid-sized sedan, will be brought to 295,299 cars in China in 2007, up 13.5 Industry Group finally announced plans to market in late 2009 or early 2010. percent from 2006. The company plans to develop its own brand of passenger vehicles. In November at the Guangzhou auto show, sell 340,000 cars this year. The company is in an enviable position Guangzhou Auto unveiled three concept The company now runs two plants in because it operates two highly profitable cars, a four-door car with coupe styling and Guangzhou, with annual joint capacity of joint ventures, one with Toyota Motor Corp. two sedans with battery or hybrid power. 360,000 units. and the other with Honda Motor Co. But it The company says it eventually will build a Guangzhou Toyota Motor Co. sold 170,294 faced growing pressure from the Chinese full range of passenger vehicles. Camry sedans in 2007. The company government to develop its own brand. The company is building a car plant and launched the Camry in May 2006 and will Guangzhou Auto is one of six large state- an engine plant in Guangzhou with annual start making a second model, the Yaris owned automakers in China, along with capacity of 100,000 units per year. hatchback, in mid-2008. China FAW Group Corp., Shanghai Guangzhou Auto’s president, Zhang Guangzhou Toyota expects to sell 175,000 Automotive Industry Corp., Dongfeng Motor Fangyou, says the company has established Camry units and 35,000 Yaris units in 2008. Corp., Beijing Automotive Industry Holding a cost-competitive supply system with Guangzhou Toyota has a plant with annual Corp. and Chongqing Changan Automobile assistance from Toyota and Honda. capacity of 200,000 units and is building a Co. But it is the only one without its own The joint ventures with Honda and Toyota second plant. The company plans to build a passenger vehicle brand. accounted for 8.9 percent of China’s 5.2 third model, the Highlander crossover, The company plans to spend $916 million million passenger vehicles in 2007. starting in April 2009. by 2010 to launch its own brand. The first Guangzhou Honda Automobile Co. sold — Kevin Huang

Shanghai Automotive Industry Corp. Ownership: No. 390 Wukang Road, SAIC Group 83.83% Shanghai 200031, P.R. China Public shares 16.17% (86) 21-2401-1000, www.saicgroup.com Top executive: Hu Maoyuan, president

Shanghai Automotive Industry Corp.’s joint The partnership also gives SAIC Motor ventures with General Motors and access to Nanjing Auto’s plant in Longbridge, Volkswagen AG produce some of China’s England. best-selling cars. Says Chen Hong, president of SAIC Motor: Now, subsidiary SAIC Motor wants its own “The British business will become SAIC’s piece of China’s rapidly growing auto new platform for Europe.” market. Last year the company launched its Both SAIC Motor and Nanjing Auto will own brand, Roewe, with the 750 car. develop cars on SAIC’s W261 platform. SAIC The 750, which starts at $32,620, launched will make the on the platform, in March 2007 and sold a modest 16,549 while Nanjing Auto will make the MG5. units in 2007. The 750 competes in the mid- In 2007, SAIC and joint ventures sold more sized segment with 24 other cars. than 1.69 million vehicles, a 25.8 percent The car “makes a significant breakthrough A slight complication is that the Roewe 750 increase over 2006, SAIC says. in this market segment, which has been and Nanjing Auto’s MG7 compete in the SAIC’s joint venture with General Motors monopolized by overseas brands for a long same segment. — Shanghai General Motors Corp. — sold time,” SAIC says. “The Roewe brand is most customized for just shy of half a million units. SAIC’s joint SAIC took another step to build its own Chinese customers, while MG will keep venture with Volkswagen — Shanghai brands in December when it acquired more of an original English taste,” says John Volkswagen Automotive Co. — sold 456,424 Nanjing Automotive Corp., which is Zeng, senior market analyst at Global Insight units, according to Automotive Resources launching the MG brand in China and Inc. He says MG “will be more sporty and Asia. Europe. will focus more on the overseas market.” — Namrita Chow

SAIC Motor Manufacturing Co. Global JVs: Building 3, 615 Ningqiao Road, Jinqiao, Pu Dong District Shanghai GM Corp. – Shanghai – Buick LaCrosse, Regal, Park Avenue, Royaum, Excelle, Shanghai 201206, P.R. China Excelle HRV; Cadillac SLS (Page 12) (86) 21-5899-9522, www.roewe.com.cn Shanghai GM Dongyue Motors Co. – Yantai, Shandong Province – Chevrolet Sail, Sail Top executive: Wang Xiaoqiu, general manager SRV, Epica, Aveo, Lova (Page 12) SAIC-GM-Wuling Automobile Co. – Liuzhou, Guangxi Province – Chevrolet Spark 2007 2006 Ownership: (Page 12) Capacity 50,000 – SAIC Motor Corp. 60% Shanghai GM (Shenyang) Norsom Motors Co. – Shenyang, Liaoning Province – Production 17,346 – Shanghai Automotive Co. 40% Buick GL8 (Page 12) Unit sales 16,549 – Shanghai Volkswagen Automotive Co. – Shanghai – VW Polo, Passat, Touran, Santana, Santana 3000, Skoda Octavia (Page 18) Models produced: Roewe 750

2008 GUIDE TO CHINA’S AUTO MARKET Automotive News • J.D. Power and Associates • Automotive Resources Asia DOMESTIC AUTOMAKERS 29

Chongqing Lifan Automobile Co. 2007 2006 Models produced: Lifan 520 Ownership: No. 60 Shangqiao Zhangjiawan, Sha Pingba Area Capacity 50,000 50,000 Chongqing Lifan Chongqing City, 400037, P.R. China Production 30,362 7,912 Industry Co. 100% (86) 236-1663-000, www.auto.lifan.com Unit sales 30,101 7,365 Top executive: Yin Mingshan, CEO

FAW Haima Automobile Co. 2007 2006 Models produced: Mazda Ownership: Jinpan Industry Development Area, Haikou City Capacity 150,000 150,000 Familia, Freema, Haima3 Haima Holding Group 50% Hainan Province 570216, P.R. China Production 126,983 83,636 China FAW Group Corp. 49% (86) 898-6682-0333, www.hnmazda.com Unit sales 130,98 880,218 Hainan Provincial Government 1% Top executive: Qin Quanqyan, general manager

Hafei Motor Co. 2007 2006 Models produced: Ownership: No. 15 Youxie Street, Pingfang District Capacity 400,000 400,000 Dingo, Lobo, Saibao Harbin Aviation Industry Harbin City, Heilongjiang Province 150066, P.R. China Production 48,225 68,125 Group Co. 74% Unit sales 44,799 65,391 Others 26% (86) 451-8658-1122, www.hafeiauto.com.cn Top executive: Liu Tao, president

Hebei Zhongxing Automobile Co. 2007 2006 Models produced: Ownership: No. 860, Jianguo Road, Baoding City Capacity 100,000 100,000 Admiral, Chiye, Infinite Hebei Tianye Automobile Hebei Province 071000, P.R. China Production 10,936 8,989 Group Co. 67% (86) 312-2190-600, www.zxauto.com.cn Unit sales 10,771 8,176 Taiwan Unite Leaders Co. 33% Top executive: Xiao Wei, general manager

Hunan Jiang Nan Automobile Co. 2007 2006 Models produced: Ownership: Nanzhushan, Xiangtan County Capacity 100,000 50,000 Jiangnan Chuanqi, Alto, Zotye Holding Group 70% Hunan Province 411207, P.R. China Production 10,006 2,369 Jingling (86) 732-2518-018, www.jncars.com Unit sales 9,444 2,553 Manufacture Co. 30% Top executive: Li Xubing, president

Anhui Jianghuai Automobile Co. 2007 2006 Models produced: Ownership: No. 176 Dongliu Road, Hefei City Capacity 50,000 50,000 Refine, Rein Anhui Jianghuai Anhui Province 230022, P.R. China Production 48,153 34,070 Auto Group 28% (86) 551-2296-666, www.jac.com.cn Unit sales 47,654 34,363 Public shares 72% Top executive: Zuo Yanan, president

Jiangxi Changhe Automobile Co. 2007 2006 Models produced: Ownership: No. 208 Xingchang East Road, Jindezhen City Capacity 30,000 30,000 Ideal China Aviation Technology Jiangxi Province 333002, P.R. China Production 9,266 18,889 Industry Co. 63% (86) 798-8462-778, www.changheauto.com Unit sales 7,295 18,400 Public shares 37% Top executive: Li Yao, president

Rongcheng Huatai Automobile Co. 2007 2006 Models produced: Ownership: Rongshan Avenue, Rongcheng City Capacity 70,000 30,000 Galloper, Terracan, Santa Fe Hengtong Group Co. 100% Shandong Province 264300, P.R. China Production 16,122 6,150 (86) 631-7554-888, www.huataixiandai.com Unit sales 13,776 6,565 Top executive: Chen Qingchun, president

2008 GUIDE TO CHINA’S AUTO MARKET Automotive News • J.D. Power and Associates • Automotive Resources Asia 30 SUPPLIERS Suppliers face rising prices, shortage of skills China’s auto market grew by double Low volumes per model also Suppliers digits in 2007, but that didn’t shield plagued suppliers as new models suppliers from the same issues continued to drive sales in China in dogging suppliers worldwide: rising 2007. Low production runs made it in China raw material and energy prices. harder for auto manufacturers and ■ For a list of And as costs rose, car prices in suppliers to achieve economies of global automotive China continued to decline. scale. suppliers in China, “We had a raw material effect that The continued growth of Japanese go to: we had to pass to the OEMs. That brands, especially Toyota, made 2007 autonews.com/ was a real challenge,” said Christian a tough year for some suppliers, said chinasuppliers Marsais, group vice president of Todd Fortner, president of Changshu China for Valeo SA. Automotive Trim Co. ■ To have your Suppliers also faced rising labor “If you’re not already a Japanese company included prices in China and a shortage of supplier, it’s very hard to get into on the list, send experienced managers and MARK RALSTON/AFP/GETTY IMAGES/NEWSCOM their supply chain,” he said. an e-mail to: engineers. The shortage was caused WORKERS PREPARE FOUR-CYLINDER Suppliers don’t expect much relief andatacenter@ by limited supply and strong ENGINES AT A PLANT IN WUHU, CHINA. in 2008. Upward pricing pressure crain.com demand. Barely a month passed in will remain, although Valeo’s 2007 without a foreign supplier dollar, the yuan’s value began to Marsais expects the prices of some announcing it was adding a new float in July 2005. The pace raw materials to stabilize. plant or opening a research and accelerated in 2007, when it Oil prices will keep rising, though. engineering center. appreciated 7 percent against the And, suppliers figure, domestic For suppliers looking to source dollar. That made it more expensive inflation will force the Chinese parts in China for export, the yuan’s for overseas customers to buy parts government to allow the yuan to appreciation hurt. made in China. In mid-March, the appreciate faster. Long pegged at about 8.3 to the dollar traded for 7.1 yuan. — Alysha Webb