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Ford Set to Invest $1.8 bil in China R&D

Playing catch-up; will VW problems provide an opportunity?

by on Oct.12, 2015

Ford CEO Fields has steadily expanded the maker's presence in China, including production and R&D.

Ford Motor Co. will invest nearly $2 billion over the next five years on its Chinese R&D operations in a bid to catch up to market leaders Volkswagen AG and General Motors.

A latecomer to what is now the world’s largest automotive market, Ford has rapidly gained ground in recent years as it has expanded both its Chine product portfolio and manufacturing network. Much of its growth has come at the expense of Japanese rivals like Toyota, but the current crisis that has tripped up VW could prove another opportunity for Michigan-based Ford.

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The new R&D effort will include the battery-based vehicles that Chinese regulators are demanding in an effort to deal with that country’s endemic smog problems. At a conference in Shanghai on Monday, Ford CEO Mark Fields said the maker will introduce both a hybrid version of the midsize Mondeo, and a plug-in, the C-Max Energi, in China next year.


Ford, GM Implement Expansion Plans in China

Makers invest in plants despite slowing economy.

by on Jan.30, 2015

Shanghai GM invested more than $1 billion in a new plant in China's Hubei province and expanded other facilities in the country.

Despite the fact that China’s economic growth has slowed, General Motors and Ford Motor Co. continue pushing ahead with plans to expand their production footprint there.

Mark Fields, Ford’s chief executive officer, told analysts this week thatFord expects the Chinese economy to grow by 7% to 7.5%, which is ample enough to sustain an increase in sales of new vehicles. Ford expects sales to come in at between 24 million and 26 million units and the automaker, with its Chinese partner, is moving ahead with plans to open two new factories in China this year.

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Ford plans to open both an assembly plant and an engine plant in China this year. Ford sales in China grew 19% in 2014 to 1.1 million units and helped maintain the profitability of Ford overall operations in the Asia Pacific region despite losses in other parts of the region. (more…)

Despite Weakening Economy, Chinese Car Sales Still Solid

Chinese airline to start in-flight car sales.

by on Mar.12, 2013

VW and GM remain locked in a battle for dominance in the booming Chinese market.

Surging global stock markets slipped back this week as China released surprisingly weak economic data – but one sector of the vast Asian nation’s economy remains strong, Chinese car sales surging 40% for the first two months of 2013 after an unexpectedly weak performance last year.

For some carmakers, Chinese demand appears to be surging as they bring on new products, while for others, it is taking new discounts to help bolster sales.

But industry analysts continue to worry about what may happen as government regulators come under increasing pressure from both the public and a new cadre of Communist Party leaders to tighten environmental regulations in the wake of record pollution levels in the capital Beijing and other parts of the country. As recently reported, stricter automotive emission rules – possibly including a press for more battery cars – are being actively considered.

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The 40% year-to-date increase in overall Chinese car sales comes despite a drop in February as the Chinese celebrated the Lunar New Year, a week-long holiday during which little or no business is transacted across China.


Chinese Car Sales Rebound – But Prices Plunge

Dealers faced with a glut of vehicles slash prices.

by on Jun.13, 2012

A Mercedes-Benz E300 on display at the recent Beijing Motor Show.

It’s the Chinese take on the old good-news/bad-news phenomenon: Chinese car sales rebounded sharply in May after a worrying slowdown earlier in the year.  But to help build momentum, dealers have been slashing prices which could translate into lost profits for market leaders like General Motors and Volkswagen.

The sharpest price cuts in several years raise fears that the Chinese car market is weakening – along with the rest of the economy – and could go into a slump if manufacturers decide to hold the line rather than accelerate the current pace of discounting.

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Chinese car sales surged 16% in May compared to year-earlier volume, a welcomed turnaround from the first quarter of 2012 when the market showed an unexpected and unfamiliar decline.  But even so, sales for the first five months of the year were up only a modest 1.7%.  Based on patterns throughout most of the past decade that might have been expected to be more like a 20, 30, even 40% gain.


GM Sets Another Sales Record in China

GM defies market slowdown.

by on Apr.11, 2012

GM continues to gain ground in China with products like the Buick Excelle.

Slowing car sales have not bothered General Motors and its joint ventures in China – which now appear on track to set another all-time record for 2012.

GM reported it sold 257,944 vehicles in March in China and 745,152 vehicles during the first quarter of 2012, setting records for both March and the first quarter.

GM’s domestic Chinese sales in March were up 10.7% from the same month in 2011. They were the second-highest for any month in GM’s history in China. For the first three months as a whole, its domestic sales increased 8.7%, the best quarter since GM began doing business in China a dozen years ago, the auto giant reported.

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“GM has maintained our growth in our largest market in 2012, despite an overall industry slowdown,” said Kevin Wale, president and managing director of the GM China Group. “Our new models, such as the Chevrolet Malibu, have gotten off to a solid start, complementing the ongoing strength of established products such as the Buick Excelle, Chevrolet Cruze and Cadillac SRX.”


Can China Sales Save Detroit?

GM, Ford score big in booming market.

by on Jul.06, 2009

Buick unveils its Riviera concept vehicle in Shanghai.  The booming Chinese market is helping GM and Ford offset declining sales in the U.S.

Buick unveils its Riviera concept vehicle in Shanghai. The booming Chinese market is helping GM and Ford offset declining sales in the U.S.

Forget the Red Menace.  When Detroit automakers think of China, these days, they’re thinking green.

While the U.S. automotive market may be defying all forecasts for a recovery, the Asian nation has confounded analysts who expected demand in cities like Shanghai and Beijing to begin tapering off.  While there has been some modest dip in Chinese car sales, the government’s aggressive actions on the economy have proved surprisingly effective at propping up the market.

And that’s good news for American makers, who desperately need to counter their home market declines.

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Ford, a relative latecomer to the booming Chinese market, saw sales soar 14% during the first half of 2009, and June sales, in particular, climb a staggering 55% compared to year-earlier numbers,


Chinese Auto Sales Hit New High in April

Guess who is about to be the largest auto producing nation?

by on May.13, 2009

QQ3 is the first sedan in China that has held four "Culture Festivals," which has made it something of a cult car. .

QQ3 is the first car in China that has held four "Culture Festivals." It has a cult like following.

Sales of China’s domestically made vehicles set a record high of 1.153 million units in April, up 25% from a year earlier, according to the China Association of Automobile Manufacturers (CAAM). It was the fifth straight month of sales gains, a new record. The latest numbers confirm preliminary estimates released last week.

The gain represents an increase of 3.9% percent from March, when sales rose 5% compared year-on-year to 1.11 million units.

Sales of China’s Chery, which makes cars with small engines, hit a record high of more than 42,000 units in April, partly because of government incentives.

All told, Chinese-based makers produced 1.16 million motor vehicles last month, up 17.9% year-on-year, according to CAAM. It was 5.6% higher than March production. At the current running rate China will become the largest auto producing nation this year.

CAAM said the April figures showed the country’s auto industry is recovering, as the government’s stimulus policies began to take effect. China instituted an incentive package for the auto industry earlier this year, cutting purchase taxes for cars with small engine capacities and providing subsidies in rural areas.

China’s one party system of government is able to move more quickly than republics such as the United States, where a stimulus bill, dubbed cash for clunkers, has been stuck in a congressional committee over Republican opposition to a larger energy independence bill it is attached to.    (more…)