By on April 14, 2014

Carlos Tavares

Though PSA Peugeot Citroen secured funding in a three-way deal between itself, the French government and Dongfeng, new boss and former Renault COO Carlos Tavares has a hard road ahead of him as he rebuilds the ailing automaker.

(Read More…)

By on April 3, 2014

Ford-Sollers-Vsevolozhsk-plant

Two plants in Ford’s joint venture with Russian manufacturer OAO Sollers will experience job cuts as a result of a weakening ruble and decreasing demand by customers in the local market.

(Read More…)

By on March 7, 2014

2015 Volvo V60 T5 Sport Wagon Exterior-005

Volvo, with parent company Geely, is developing a lineup of premium A-segment vehicles aimed at the BMW 1 Series and Mercedes A-Class.

(Read More…)

By on February 21, 2014

China’s Ministry of Industry and Information Technology, in line with President Xi Jinping’s desire for opening the domestic economy to private and foreign investors, plans to relax restrictions on foreign ownership of joint ventures with local automakers in the face of those warning such a move would be the beginning of the end of the Chinese local auto industry.

(Read More…)

By on February 13, 2014

dongfeng-peugeot-citroen

PSA Peugeot Citroen, Dongfeng and the French government have reached an outline deal to raise $5.5 billion in capital through a planned share sale in a last-ditch effort by PSA to remain alive after General Motors walked out of a similar deal over the Iranian market last year.

(Read More…)

By on December 6, 2013

2014 Buick Regal GS

The automotive industry lobby group China Association of Automobile Manufacturers is at loggerheads with Beijing over a rule change proposal that would ease restrictions on foreign ownership of auto manufacturing ventures. The fear, according to CAAM Secretary General Dong Yang, is that should the restraining bolt be removed, the local industry would lose control of the joint ventures they currently hold, if not the Chinese auto industry itself.

(Read More…)

By on August 23, 2013
Pilot production begins at Volvo's Chengdu plant in China

Pilot production begins at Volvo’s Chengdu plant in China

Geely Automobile Holdings Ltd., owned by the same Chinese company that bought Volvo Cars in 2010, announced that it will soon start developing cars jointly with the Swedish company. The cars will be intended for the Chinese and export markets and will go on sale in 2015. Geely has ambitions to be China’s largest car exporter. Working jointly with Volvo is seen as giving Geely products some of Volvo’s reputation for safety and reliability.

“We have entered into actual research and development stage and I believe we can see the new product in the year after next,” said Geely Chief Executive Officer Gui Sheng Yue yesterday in Hong Kong.

Zhejiang Geely Holding Group Co., bought Volvo from Ford for $1.8 billion and last year the two companies signed a memorandum to “leverage its full access” to technology to develop vehicles. Earlier this year, Volvo announced that it was going to build a joint R&D center with Geely in Gothenburg. Volvo has also started assembling test builds at its first factory in China, in Chengdu, which will have an annual capacity of 120,000 cars.

Volvo Cars also announced today that it has received approval from the Chinese national government to build two more factories in China. The assembly plant in Daqing, in northeast China, will have a capacity of 80,000 units a year and is hoped to be fully operational some time next year. The facility in Zhangjiakou will be an engine plant and it will supply the Chengdu assembly operation where actual production will begin in Q4 2013. The two assembly plants are not expected to reach capacity for a few years.

By on October 14, 2011

 

My fleeting 15:21  minutes of dubious fame.

By on October 11, 2011

The Global Automotive Forum is an annual confab of Chinese politicos, functionaries, industry leaders and wonks of the world. This year, it is in Chengdu, and the motto is “From volume leader to innovation leader.” The subhead could very well be: “What now?”

Speaker after speaker bemoans the fact that China is winning by sheer numbers, but is falling behind in the innovation race. The fractionalized Chinese car industry simply does not have the wherewithal to keep up with the big multinationals. (Read More…)

By on August 23, 2011

Conventional wisdom says that the Chinese will suck all the know-how out of their foreign joint venture partners, and once they are through with them, they’ll discard them like Dracula a bloodless virgin. As a thank you, the Chinese will flood foreign countries with cheap Chinese cars. The trouble with conventional wisdom is that it is rarely true, or wise. Actually, the Chinese are now worried that the foreigners amass too much power. “Foreign car producers have begun to take more control of their joint ventures in China, sidelining their Chinese counterparts from business partners to factory providers,” China Daily writes today. China Daily is owned by the Chinese government. (Read More…)

By on March 23, 2011

The Financial Times has revealed an insidious plot: “Foreign carmakers wishing to build new plants or add capacity in China’s burgeoning car market are being told by the government that if they wish to expand, they must develop a low-cost local car brand.”

It must be a REALLY slow news day (it is). (Read More…)

By on November 10, 2010

I came to China first in 2004 on a job for Volkswagen. Back when, and years thereafter, the foreigners at the joint ventures agreed (latest after the third beer at Paulaner) that eventually, their days will be numbered. “Once the Chinese have learned enough, they’ll kick us out,” was the lament. That was six years ago, and no sign of an expulsion from the Chinese paradise yet. On the contrary: The Chinese might invite the foreigners in for good. They are thinking about dropping the 50:50 joint venture requirement that forces foreign automakers to team up with local manufacturers. (Read More…)

By on April 18, 2010

End of last year, we reported that the Chinese government was publicly thinking about new regulations to shift a large chunk of cars bought by the government to home-grown brands. We are talking about a serious amount of money here. The government is the biggest customer of cars in China, with an annual budget of around $15b. Government purchases influence the whole market. To buy Chinese. (Read More…)

By on December 17, 2009

NOFORN in Chinese. Picture courtesy angelgracia.com

When I came to China for the first time in 2004, after-work congregations of foreign executives who worked for Chinese auto joint ventures usually went like this: Someone muttered into his Tsingtao beer, or something stronger: “The Chinese will want us out within eight years.” Upon hearing this, all others around him nodded gravely, and another round was ordered. Over the years, more and more expats were sent home to Detroit, Wolfsburg, and Aichi. The silly “twin” system (a foreigner and a Chinese on the same job) stopped. Of course, the open secret was never officially discussed, but the outcome appeared to be inevitable: The days of the foreigners are numbered.

It will be 2010 within a few weeks, and the foreign (U.S., European; Japanese) joint ventures are still seemingly safely ensconced in China. As reported umpteen times at TTAC, China has become a strategically important market for most auto manufacturers. Nobody thinks anymore that come 2012, China will kick all joint venture partners out.

Yet, here is the first step in that general direction:
(Read More…)

Recent Comments

New Car Research

Get a Free Dealer Quote

Staff

  • Authors

  • Brendan McAleer, Canada
  • Marcelo De Vasconcellos, Brazil
  • Matthias Gasnier, Australia
  • J & J Sutherland, Canada
  • Tycho de Feyter, China
  • W. Christian 'Mental' Ward, Abu Dhabi
  • Mark Stevenson, Canada
  • Faisal Ali Khan, India