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Shanghai (Group) Corporation

A bright future ’s Automotive Success Story

Shanghai Automotive Industry (Group) Corporation (SAIC): the story of one of China’s most ­important automobile manufacturers is driven by famous models. It began with the Shanghai 760 built in the late fifties, a weighing more than a ton. And today, in 2012, SAIC is really gaining traction with state-of-the-art technology. Text: Gerd Golbach · PHOTOs: Ingo Bulla · SAIC 036

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The 750 is one of SAIC’s models for success. HOERBIGER supplies com- plete synchronizer systems for the transmission. www.saicgroup.com he Shanghai 760 was developed in Maoist Upon intervention by the Chinese government, the two en- ­China. The heavy-weight sedan was the vehicle tities merged to jointly produce the almost identical models of choice of the Chinese political upper class, of SAIC and NAC MG. SAIC continued to develop the Brit- whose positions were not high enough for the ish models and is selling them with a newly designed com- dream car, the “Red Flag.” In top years, the pany logo under the Roewe marque. The name had to be On right: In 2012, the trans- Tplant manufactured as many as 9,000 ­vehicles annually. changed because the naming rights to as well as the mission production operation Even as late as the 1990s, being chauffeured through Beijing logo are owned by Ford. was relocated to the new in a Shanghai 760 taxi was a highlight among tourists. ­factory in Shanghai. One of SAIC is presently the largest automobile conglomerate in the products manufactured Today, the Shanghai 760 is a museum piece. The true China. In 2011, the company produced more than 4 mil- at this site is the transmission ­success story of the automotive industry in China ­began in lion vehicles, of which the two joint ventures Shanghai GM for the . the eighties—with Shanghai Automotive Industry Corpora- tion as the trailblazer. The Shanghai VW has been producing the Shanghai Santana since 1983. The first Santana generation dominated the urban landscapes of the Chinese metropolises until the nineties. It was a ­robust and comfortable vehicle, which did well on China’s roads and soon could be found even in the remotest of spots of the country.

Even though it was produced in China, ­drivers were always proud of sitting behind the wheel of a “German” automobile. 038

The success of the Santana paved the way for SAIC devel- 039 oping an entirely new supplier industry for automotive components in the late 1980s and 1990s. While in 1987 the only locally manufactured components of the Shanghai Santana were the tires and car radio, the share of locally produced parts was expanded to more than 90 percent in a matter of ten years. This was due in part to the govern- ment of the City of Shanghai, whose goal at the time was to double Shanghai’s share in the national production of vehi- cle components. In 1997, a new joint venture was created: this time with . In 1996, Shanghai GM ­began to produce and Chevys and helped SAIC and Shanghai VW manufactured 2.4 million . The Above: Professor Fang double its annual production between 2000 and 2006. most popular in China, the “,” Weirong, Transmission Vice ­accounts for 1.2 million vehicles. ­Director of SAIC Motor From China’s Number One ­Passenger Vehicle Company to a Global Player Brand Diversity: (SMPV), has been working With the onset of the new millennium, SAIC prepared its Cars for Everyone’s Taste for the company since 1986. presence on the international market. In 2002, SAIC SAIC sells vehicles under various brands. The Yuejin, ­acquired a majority stake in the Korean automobile manu- Roewe, MG and brands are exclusive to SAIC. The facturer SsangYong Motor, gaining access to the Korean’s brands used by the joint ventures are , , international dealer network. ­Bajun, , Skoda, and Wuling. SAIC Motor Passenger Vehicle Company (SMPV), which is wholly SAIC had grown with the Chinese automobile market until owned by SAIC, is in charge of developing and manufac- 2002. Driving factors for this growth were the joint ven- turing the Roewe and MG series. SMPV plans to sell tures. For almost ten years now, the Chinese automotive 700,000 Roewe and MG vehicles annually by 2015, which industry has attempted to become established on the equates to three times the 2011 sales figure. SMPV addi- worldwide market with new products it developed on its tionally plans to launch three to four new models every own. And it has done so successfully: in 2005, SAIC year beginning in 2015. Professor Fang Weirong, Trans- ­acquired the licenses to the Rover 25 and mod- mission Vice Director at SMPV, started with SAIC Motors in els from the insolvency assets of MG . The 1986. “I began,” he reported in an interview with production equipment and machines were acquired in HOERBIGER@­MOTION, “at precisely the time when VW 2006 by its then competitor, Chinese automaker came to China. My first major project was to implement the Automobile Corporation (NAC), which holds the naming production of the Santana five-speed transmission in rights to MG and founded the NAC MG. ­China starting in 1988.” The MG and Roewe models are developed primarily in The MG 6, the , the and the new Bottom: In addition to Shanghai. A total of 1,800 engineers in Shanghai work MG 3 are presently manufactured in Shanghai, the Roewe the transmissions for closely with 300 engineers in Nanjing and 250 engineers 350 and the MG 5 in Nanjing, while Roewe 750 and the the Roewe 750, in the in near , England. Longbridge re- ­particularly for the ­Chinese market important W5 SUV in future the transmissions cently opened the SAIC Motor Technical Centre (SMTC). ­Yangzhou. In Longbridge, the models developed in China are for the , MG The focus of the company still lies on successfully develop- assembled with components manufactured in China for the 5 and MG 6 (picture) ing the brand, which is apparent alone from the fact that European market. will be produced in the engines and transmissions departments employ in Shanghai. ­total more than 130 engineers. Professor Fang Weirong says: “Our models are positioned in the mid-range and luxury market segments. We have strict requirements in terms of performance and quality. Our low production costs give us a competitive edge. How- ever, we are not a low-cost brand; our company produces high-quality vehicles. In the next five years, China will be the most important market for SMPV,” adds Professor Fang Weirong. “Tough we are also starting to develop the international market. For example, we have already After years of unabated growth and investments, the Chi- shipped approximately 6,000 vehicles abroad.” SMPV PART nese automotive sector is facing a consolidation process in plans to sell the drive assemblies together with the trans- the medium range. SAIC is positioned well and has solid missions to other companies, for example the SCM 250. Synchronizer systems are an important component in man- ­financial backing, so that it is very likely to gain from the The demands on the technical quality and cost-­effective ual transmissions. Because of HOERBIGER’s intensive prod- consolidation and maintain its position. pricing are therefore very high. uct development process and extensive transmission testing, 040 its synchronizer systems are always optimized. Premium “In the future, we hope to achieve progress components assure the performance of the transmission. with regard to developing new synchronizer 041 HOERBIGER produces the synchronizer components that system designs through the excellent are intended for SAIC at its sites in Schongau, , and ­cooperation with HOERBIGER.” Changzhou, China. In Changzhou, the synchronizer systems SAIC was the first Chinese state-owned company to enter are completed before they are shipped to the customer. into a joint venture: this was with . SAIC In the near future, the sales figures will not rise as drasti- HOERBIGER supplies SAIC with complete synchronizer sys- has been collecting experience from this international co- cally as over the past few years. The annual growth rate tems for the SH78Z transmission installed in the Roewe 750. operation since 1983. The collaboration was expanded in that can be anticipated is approximately 10 percent. ­SAIC In 2012, SAIC relocated the transmission production to a the mid-1990s to include General Motors (GM). After ­ will maintain the collaboration with newly constructed factory. This is where the new SCM 250 20 years as a “junior partner” to international automobile partners. Notably the cooperation with GM continues to be transmissions for the Roewe 350 and MG 5 as well as the groups, SAIC now also operates internationally and is an very close: they produce everything jointly, from the drive SCM 360 transmissions for the MG 6 will soon roll off the equal partner and investor. In 2002, SAIC participated in assembly to the transmission. This allows the technology to line with synchronizer systems made by HOERBIGER. the acquisition of Korea’s automobile manufacturer Dae- be kept up-to-date. ­HOERBIGER will continue to support SAIC with innovations. woo by GM. SAIC currently holds a ten percent stake in GM Engineers from both companies are currently working on an Daewoo. In 2004, SAIC gained control of the Korean auto- Modern Synchronizers for Electrical Drive Unit (EDU). The center of this collaboration mobile manufacturer SsangYong Motor. Through its merger an Edge in the Competition revolves around the application of a synchronizer unit in the with Corporation, which had produc- HOERBIGER is also an important international business part- drivetrain of an electric vehicle. tion plants not only in China, but also in Longbridge, Eng- ner: “HOERBIGER supplies complete synchronizer systems land, SAIC further expanded its position as an international for the three manual transmissions of SAIC Group which are car manufacturer. Six years ago, SAIC and HOERBIGER the most advanced technologically. In the future, we hope to jointly optimized the transmission for the Roewe 750. Over achieve progress with regard to developing new synchronizer PART OF the years, the two partners have continued to expand their system designs through the excellent cooperation with close working relationship. HOERBIGER supplies not only HOERBIGER,­ ” states Professor Fang Weirong “HOERBIGER China, the world’s largest automobile market, now has complete synchronizer systems for the Roewe 750, but is is a company that not only continually enhances its products, more than 6,500 companies which serve the continually now also involved in the development of innovative syn- but is also able to respond to the cost pressure we are faced growing automobile market. Based on annual production, chronizer systems for the current and future model series. with in competition.” companies leading by a wide margin in 2011 included HOERBIGER cooperated with the engineers in Longbridge Shanghai Automotive Industry (Group) Corporation (SAIC) even before they have been acquired by SAIC. This rela- “We hope to be able to make our products competitive in the with 4 million vehicles, Dongfeng Motor Corporation (DMC) tionship had a global focus right from the start. While the future by continuing the close cooperation with such a with 3.5 million vehicles, China First Automobile Group Cor- SAIC Motor Technical Centre (SMTC) in England works With Joint Ventures toward Cutting-Edge ­competitive company as HOERBIGER. HOERBIGER not only poration (FAW) with 2.6 million vehicles, and Chang’an with closely with HOERBIGER Antriebstechnik GmbH in Schon- Technology developed in China has a strong position in terms of product quality, but also the 2 million vehicles. These four companies accounted for gau, Germany, SAIC engineers in Shanghai value the prox- Professor Fang Weirong says: “The joint ventures with VW capability to manufacture locally. For us, it’s not only the cost 64 percent of China’s total automobile production. As sales imity of HOERBIGER development engineers at HOERBIGER and GM gave us access to sophisticated technology. We advantage which comes from producing in China that counts, growth in China is decreasing, notably SAIC and FAW are Drive Technology (Changzhou) Co. Ltd. HOERBIGER’s now independently continue to develop it. We strive to but also the proximity to our suppliers,” adds Professor Fang making a push into the international market, attempting to global nature assures shorter paths for the customer and bring our technology up-to-date with the acquisition of MG Weirong. also gain a foothold in the electric vehicle market segment. tailor-made solutions for any market. and through the collaboration with SMTC in England, while also hiring qualified engineers in China.”