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Changan Auto to build cars in Mexico, eyeing US market

November 07, 2008

Changan Automobile Group, Ford Motor Co's China partner, plans to build a manufacturing plant in Mexico with a local firm and aims to export cars to North America, its vice president said on Thursday.

"We have signed an initial agreement with our Mexican partner to make compact and mid-sized cars there. The plant would start operation at the end of 2009 or early 2010," Luo Minggang said on the sidelines of an auto forum organised by the China Europe International Business School in Shanghai.

Luo did not identify the Mexican partner, which makes and distribute vehicles, but said the plant, which gives Changan a foothold in the North American market, will have an initial annual capacity of 50,000 cars.

Cars made at the facility will be sold initially in Mexico where Changan is already selling mini vans and mini trucks, but they will be shipped to the United States eventually, he said.

He declined to give a timetable, citing the current slump in the North American car market, which has pushed General Motors and others into deep losses.

Changan is among a growing number of Chinese automakers, including top player SAIC Motor Corp, hoping to emulate the global successes of their Asian rivals with internally designed and manufactured cars.

Brilliance, parent of Brilliance China Automotive Holdings, secured a deal in 2006 to sell 158,000 sedans to Europe over the next five years.

Brilliance, which runs a venture with BMW in China, said in July that it would ship its first BS4 sedans to Germany, aiming to bolster its fortunes in the hotly contested market after poor crash test results hurt sales of a previous model.

Hong Kong-listed rechargeable battery maker BYD Co has signed up 10 distributors for its plug-in hybrid car in Europe ahead of its targeted entry into that market in 2010, a senior company executive told Reuters last month.

19,768 Posts
Chang'an Automobile, the Chongqing-based carmaker that has joint ventures in China with Ford, Mazda and Suzuki, has signed an agreement in Mexico with Grupo Hispanoamericano Autopark for the manufacture and marketing Changan cars in the region, reported Empresa Exterior, a local weekly business magazine.

In a visit to Mexico on February 10, Changan president Xu Liuping signed a framework agreement with Autopark president Juan Manuel Vinos, to build Changan's Benben, Zhixiang and Yuexiang cars in Mexico.

The formal joint venture agreement is scheduled to be signed within two months and the first batch of vehicles will be exported to Mexico by the end of 2009.

The joint venture plants also targets exports to the U.S. and Latin American markets, where strict quality tests are required for new vehicle entries. The report said a Changan car model has already passed the tests of adaptability to the Mexican market last December.

Autopark Mexico is a Latin American company 25% owned by the Spanish Import Autopark (a subsidiary of Autopark Ibérica) and the rest by the two major Mexican retailers, Alden and Fame, as well as several important Mexican businessmen.

Autopark president Juan Manuel Vinos (left) and Changan president Xu Liuping have signed a cooperation agreement in Mexico

February 17, 2009 from

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China's Changan delays plan to enter North American auto market

Changan Automobile Group, China's No. 3 automaker, said on Monday it had slowed down plans to set up a Mexican plant but remained committed to breaking into the North American market.

"We are still doing market research there. There won't be any big investment for the time being," Zhu Huarong, head of Changan's research and development division, told Reuters.

"We have slowed down the pace of the plant a bit because of the financial crisis, but our plan is unchanged," Zhu said in an interview.

The company said the Mexico plan would secure a foothold to North America.

Changan, a Ford Motor (F.N) China partner, signed a deal last year to set up in Mexico.

Changan is among a growing group of Chinese automakers, including its top player SAIC Motor Corp, hoping to emulate the global success of Japanese carmakers like Toyota Motor (7203.T).

SAIC, which bought MG Rover's 10,000-unit Longbridge plant in Britain in 2007, wants to start making its MG 6 sedan in the UK, its president Chen Hong told reporters on Sunday.


Chinese automakers are mostly focused on the lower end of the domestic market, leaving the lucrative higher end to foreign brands, such as General Motors GM.UL and Volkswagen (VOWG.DE).

But as wealth grows in what is now the world's top auto market, many Chinese manufacturers are looking to boost their patriotic profile tby offering higher-end models.

Chery Automobile, whose QQ sells for as little as 30,000 yuan ($4,394), unveiled its first premier car G6 under the Riich brand in April, followed by G5 six months later.

Changan, which currently makes small cars, such as Yuexiang and BenBen, is also working hard to tap the upper end of the market, Zhu said.

"We have been investing heavily in research and development. We will not stay at the lower end forever. If fact, you can see our first self-made saloon within months," he said, declining to provide further details.

When asked why Changan did not acquire western brands to raise its own profile like some of its peers, Zhu said: "We had some initial contacts with some foreign brands but decided to give up in the end."

"After all, it's still a foreign brand even after you take it over. We want to make expensive cars on our own."
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