Chinese Numerology, FAW Edition
China’s FAW, despite its name (First Automobile Works) only second largest manufacturer in China, joint venture partner of Volkswagen and Toyota, and owner of a large array of brands, including the Hongqi, has filed its contribution to the 12th Five-Year Plan (pretty much the only holdover from the olden days) with China’s State-owned Assets Supervision and Administration Commission (SASAC). The numbers, brought to us by CapitalVue, are both audacious and timorous.
In the audacious dept., FAW singlehandedly wants to achieve a sales volume of five million vehicles by 2015. Not a small feat. It’s about half of what all of the U.S.A. bought in 2009. But with a Chinese car market that goes nowhere but up, this target should be achievable.
They also plan to have a market share of 20 percent. Let’s book that in the audacious dept also. With around 100 automakers in China (nobody is quite sure), achieving a 20 percent share comes close to total market domination. 20 percent … wait a minute!
According to my Made in China calculator, 5 million cars at a 20 percent share comes to a total market size of 25m cars. And with that, we are entering the timorous world. China wants to sell between 16 and 17m cars this year. 25m by 2015 would come out to a growth rate of less than 10 percent per year.
That’s all you dare to put in the 5 year plan, FAW? Come on. No guts, no glory, or Chinese words to that effect. Let’s hope there was something lost in translation.
(Speaking of China: I found myself alone at the office this morning, as all of China has taken off to celebrate the Moon (a.k.a. Lantern or Mooncake) Festival. It will last through the rest of the week. Those who wish less news from China will get their wish fulfilled! There should be pretty much nothing from China while the country is partying.)
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
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Hey Bertiil, howzabout providing us a translation of some of these car names? I'm going to guess that "Hongqi" is a car for white guys from the suburbs. But a Dongfeng?
“Hongqi” is a car for white guys from the suburbs. It meant Red Flag, in the old days our beloved Chairman or Fuhrer bestowed his Army as Number " 8 " , 8 th Army, Uncle Eigth etc. They use Red flag, I guess the Red Flag was something to commorate those glory days. For a while during the 60s Red Army and also the Junior Red Guards was not some thing anybody wanted to talk about. SImply Auschwiz came to your local village. More than coming to your local theatre. Circa that time my fnd ate tree roots for Lunch, supper or the SPAM's worse equivalent of staples. Middle Kingdom for some reason had a few very bad years for crops, or took up Lysenko's growing/farming method Dongfeng= Eastern Wind I gues it symbolise of new growth, hope. A fnd told me the Red Flag Limousine sedans were totally custom made, should u banged up a fender, dont bother to swap a fender from another car, as Meister Liu did bespoked his fender for your car a little bit different from another production run, so u need to straighten out your old one. I suppose the newer ones would have more consistency. Many yrs a go a few of the Red Flags were being sold off by the central govt, as newer ones would replace them.