2004 Beijing Motor Show, Part III Page 2

June 10, 2004
Nissan betting heavily on China

Nissan Teana Beijing show

Nissan Teana Beijing show

Enlarge Photo
Nissan’s initial turnaround relied heavily on rebuilding its market in the United States. Going forward, the automaker expects China to play a major role in its global expansion, company officials declared during a preview at the Beijing Motor Show. The automaker used its time slot to launch the new Tian-lai, a feature-rich version of the upscale Japanese Teana sedan. And it revealed plans to bring the Infiniti line of luxury cars to the country, as well. A latecomer to the Chinese market, Nissan is nonetheless optimistic of its opportunities. The automaker recently announced the so-called Nissan Value-Up plan, which would boost its global sales from around 3 million last year to 4.2 million in 2007. “China is expected to be one of the biggest contributors to that increase,” stressed Nissan Executive Vice President Toshiyuki Shiga. If the company hits its target, China would account for 500,000 sales annually, making it Nissan’s third-largest market, after the U.S. and Japan. Is there really that much of a market, TheCarConnection.com asked Katsumi Nakamura, CEO of Nissan’s Chinese joint venture, Dongfeng Motor Co. Ltd? “Even if ten percent of the population would want to buy a car,” Nakamura replied, “that would be 130 million people, almost as many as you have in Japan.” —TCC Team

 

 

Three critical letters

Everywhere one goes in Chinese automotive circles, you hear three letters repeated over and over: “IPR.” That’s shorthand for intellectual property rights, and it may be the single-biggest issue facing China as it pushes to modernize its economy with Western assistance. Walk down almost any city street and you’re confronted with vendors hawking DVDs of the newest Hollywood films. For carmakers, technology, designs, and even logos are copied with seeming impunity.

Cherry QQ Beijing show

Cherry QQ Beijing show

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Toyota lost a battle with one alleged pirate, and Honda is heading to court to block another. General Motors is just wrapping up its investigation into the Cherry QQ, an apparent clone of the small Chevrolet Spark. “We’re making our case to the government,” said Phil Murtaugh, GM’s top executive in China. New government rules for the auto industry promise to protect intellectual property rights, the English translation suggesting Chinese firms that illegally steal IPR would be banned from selling their products. But if such a move is in the works, there seemed little fear from the domestic automakers appearing at Auto China 2004. Several controversial products, including the QQ, were given the central position at the main exhibition hall. Oh, and nearly a third cheaper than the Spark, Cherry's little car is outselling the Chevy by about six-to-one in the Chinese market. —TCC Team

 

VW plans new factories in China

Volkswagen AG will begin work next week on a factory near Shanghai that will focus on exports and have a capacity of up to 300,000 cars per year. Funding for the $240 million plant will reportedly come from the more than $6 million that the automaker plans to invest in China over the next three years. According to various reports, the Lin Gang plant will begin production in two to three years at a production volume of 150,000 units, but that could be stepped up depending on demand. VW intends to increase the portion of China-sourced parts content in its cars to keep prices competitive, and it plans to build two new engine factories in China. According to a Bloomberg report, one of those would be in Dalian, in the northeastern region. Through joint-venture arrangements, Volkswagen already produces several vehicle models at two plants, one just east of Shanghai and the other in Changchun City, also in the northeast.

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