Changan Automobile Group targets sales of six million units by 2020
Global R&D network established; Changan brand name aggressively promoted
Since 2011, the sales volume of Changan Automobile Group has been on the decline. This trend has been caused by the termination of purchase promotional programs by the Chinese government as well as the stalled growth experienced throughout Chinese national brands (Chinese manufacturers' own brands) resulting in a y/y decrease of 15.6% to 2.01 million units for 2011, and sales volume for the January to September period of 2012 was down 8.5% y/y to 1.4 million units.
In spite of struggling group sales, Changan Automobile Group is proactively introducing new models under its own brand to expand its share in the market. In early 2011, the manufacturer established a worldwide R&D network at nine locations in five countries. To date, a number of models engineered through this system, such as the Eado and the Alsvin V3, have been introduced to the market. Changan Automobile Group has declared that it will grow the number of vehicles manufactured and sold to six million units by 2020, covering 60% of the volume with its own brand models.
In the realm of its joint venture with foreign OEMs, Ford is increasing its investment in the joint venture. The joint ventures owned by Changan Ford Mazda and Jiangling Motors are jointly constructing five plants. With the completion of these plants, Ford expects to achieve an annual vehicle production capability of 1.2 million units. With the acquisition of a heavy-duty truck OEM by Jiangling Motors, there's a rumor that Ford trucks may make an entry into the Chinese market.
The joint venture with PSA is organizing production sites and sales networks aiming to achieve production and sales volumes of one million units by 2020. As the first phase to accomplishing this goal, it began the import sales of the DS Line in June 2012.
On the other hand, September sales volume for the joint ventures with Japanese OEMs dropped altogether due to anti-Japanese protests. Mazda and Suzuki both launched improved and new models, respectively, but some of the Japanese automakers are still cutting its productions as the situation continues to be uncertain.
Related Reports: Beijing Motor Show 2012 - Changan Automobile (June, 2012)
Decline of sales volume continues in 2012
The group sales volume for 2011 dropped 15.6% y/y to 2.01 million units, failing to achieve its original goal of 2.4 million units. It is assumed that the termination of government led purchase promotional campaigns such as "exchanging old for new" and "automobile industry promotion program in farming areas" at the end of 2010 are the cause of this downfall. Minivans and light-duty trucks were the targets for receiving subsidies for the "automobile industry promotion program in farming areas," and the Changan Automobile Group provided a variety of major minivans throughout the group, making a large contribution to the group sales between 2009 and 2010.
The decline continued in 2012 with total sales down 8.5% y/y to 1.4 million units in the period from January to September. In addition to the overall sales decline in Chinese brand vehicles and CVs, the trend was also influenced by the September anti-Japanese protests resulting in the sales of Japanese OEMs to drop.
Changan Automobile Group's sales volume by model (Factory shipment)
|Manufacturers||Segment||Models||2008||2009||2010||2011||Jan.-Sep. 2011||Jan.-Sep. 2012|
|Total of Passenger Vehicles||651,698||1,458,787||1,843,991||1,576,033||1,184,980||1,134,601|
|Changan Automobile||Sedan, Hatchback||Benni series||39,036||42,385||78,955||90,056||70,781||53,197|
|Changan Ford Mazda||Sedan, Hatchback||Mondeo||39,621||44,402||51,586||64,511||42,323||47,364|
|Changan Suzuki||Sedan, Hatchback||Cultus||47,291||59,677||41,644||52,243||39,494||27,914|
|Jiangling Motor Holding||Sedan, Hatchback||Landwind S-Drive||3,265||801||-4||1||1||0|
|SUV||Landwind Brand's SUV||4,095||3,833||12,540||13,021||9,672||8,570|
|Changhe Automobile||Sedan, Hatchback||Wagon R||-||76,138||71,339||58,158||39,722||48,925|
|Hafei Automobile||Sedan, Hatchback||Saima||-||5,809||3,191||2,636||2,264||1,650|
|Total of Commercial Vehicles||209,679||411,015||534,807||432,507||348,376||268,897|
|Trucks (including chassis)||179,683||374,807||480,147||371,990||302,828||226,764|
|Total of Changan Automobile Group||861,377||1,869,802||2,378,798||2,008,540||1,533,356||1,403,498|
|Note 1.||The companies will be referred to in short names for convenience. Their full names are as follows: Changan Automobile (Chongqing Changan Automobile Co., Ltd.), Nanjing Changan Automobile (Nanjing Changan Automobile Co., Ltd.), Hebei Changan Automobile (Hebei Changan Automobile Co., Ltd.), Beijing Changan Automobile (Beijing Changan Automobile Co., Ltd.), Jiangling Motor Holding (Jiangling Motor Holding Co., Ltd.), Jiangling Motors (Jiangling Motors Corporation, Ltd.), Changan Suzuki (Chongqing Changan Suzuki Automobile Co., Ltd.), Changan Ford Mazda (Changan Ford Mazda Automobile Co., Ltd.), Changan Kuayue Automobile (Chongqing Changan Kuayue Automobile Co., Ltd.), Changan Bus (Baoding Changan Bus Manufacturing Co., Ltd.), Changhe Automobile (Jiangxi Changhe Automobile Co., Ltd.), Changhe Suzuki (Jiangxi Changhe Suzuki Automobile Co., Ltd.), Hefei Changhe Automobile (Hefei Changhe Automobile Co., Ltd.), Hafei Automobile (Harbin Hafei Automobile Industry Group Co., Ltd.), Hafei Motor (Hafei Motor Co., Ltd.), Changan PSA (Changan PSA Automobiles Co., Ltd.), Chang'an Heavy Vehicle (Taiyuan Chang'an Heavy Vehicle Co., Ltd.).|
|2.||The sales volume for Jiangling Motors is included in Jiangling Motor Holding, and Changhe Suzuki in Changhe Automobile.|
|3.||The "CV total" is a total sales volume of Changan Automobile, Jiangling Motor Holding, Changhe Automobile, Hafei Automobile, Changan Bus, Chang'an Heavy Vehicle, and Changan Kuayue Automobile.|
|4.||Changhe Automobile, Changhe Suzuki, and Hafei Automobile were originally subordinate OEM companies of Aviation Industry Corporation of China. The three companies were merged into the Changan Automobile Group when Aviation Industry Corporation of China and China South Industries Group Corporation reorganized their automobile department and created the group in November 2009.|
|5.||Changan Ford Mazda launched the third generation of the Ford Focus in early 2012. The new model went into market under the name New Focus to be sold along with its second generation model.|
|6.||The data for 2011 and the January to September period of 2012 for Mazda3 includes sales volumes for the Chinese model of the second generation Axela, the Mazuda3 Xingcheng. It is now sold along with its first generation.|
|7.||Changan Ford Mazda started manufacturing of the Volvo models at its Chongqing First Plant from 2006. The contracts for the S40 and the S80L will expire in 2015 and 2018, respectively.|
|8.||Changan Suzuki has separate model names for the SX4 versions: the Tianyu SX4 for the hatchback and the Tianyu Shangyue for the sedan version.|
To promote construction of new production facilities in and outside of China
Changan Automobile Group's Production Capacity
|Manufacturers||Plants||As of Oct. 2012||Planned||Models|
|Changan Automobile||Changan Automobile||Chongqing Jiangbei Plant||*300,000||*300,000||Chana Star S460, Chana Star 2, Chana Jinniuxing , etc.|
|Chongqing Yubei Plant||400,000||400,000||Eado, Benni Mini, Benni Love, Alsvin, Alsvin V5, CX30, CX20, Raeton, CS35 , etc.|
|Changan Automobile Yuzui Qianyi Auto City (Jiangbei District, Chongqing)||300,000 (Started operations in Mar. 2011)||800,000 (2015)||Small-displacement cars, New energy vehicles|
|Nanjing Changan Automobile||Nanjing Plant, Jiangsu Province||*300,000||*300,000||Chana Star series|
|Hebei Changan Automobile||Dingzhou Existing Plant, Hebei Province||*210,000||*500,000 (2015)||Chana Star Light 4500, Chana Star Truck, New Chana Star, etc.|
|Dingzhou New Plant, Hebei Province||*210,000|
|Beijing Changan Automobile||Beijing Plant||Construction started in Sep. 2010||200,000(1st phase to be completed in 2012) →500,000 (2nd phase to be completed in 2015)||Planned: Alsvin V5, Raeton|
|Jiangling Motor Holding||Changbei Plant, Jiangxi Province||50,000||50,000||Landwind X8, Landwind X9, Landwind X6, Landwind Fashion; Planned: Landwind X5|
|Jiangling Motors||Jiangxi Existing Plant||*200,000||*200,000||Yusheng, Baowei, Baodian, Kairui, New Generation Transit, Classic Transit, etc.|
|Xiaolan Plant, Jiangxi Province||Construction started in Nov. 2007||*200,000 (max. 300,000, Operational in the1st half of 2013)||Planned: all-new Ford Transit, U375|
|Chang'an Heavy Vehicle (Taiyuan Plant, Shanxi Province)||*15,000||*50,000||Trucks, Tractors, Special vehicles|
|Changan Suzuki||Chongqing First Plant||250,000||250,000||Tianyu SX4, Tianyu Shangyue, Swift, New Alto, Cultus|
|Chongqing Second Plant||Construction started in Apr. 2012||100,000 (1st phase to be completed at the end of 2013)||Suzuki's two new models|
|Changan Ford Mazda||Chongqing First Plant||250,000||250,000||Mondeo-Zhisheng, Jingdian Focus, S-MAX, Volvo S40, Volvo S80L|
|Chongqing Second Plant||150,000 (Operations started in Feb. 2012)||150,000||New Focus; Planned: New Ecosport, New Kuga|
|Chongqing Third Plant||Construction started in Aug. 2012||350,000 (Operational in the 2nd half of 2014)||Planned: Middle to high class models|
|Hangzhou Plant, Zhejiang Province||Construction started in Aug. 2012||250,000 (Operational in 2015)||Predicted: Lincoln|
|Nanjing Plant, Jiangsu Province||240,000||240,000||Mazda3xingcheng, Mazda3, New Mazda2, Fiesta; Planned: CX-5|
|Changan Kuayue Automobile||Jiangbei Plant, Chongqing||*50,000||*50,000||Crossover, Spruce Leopard, Power Leopard, Star Leopard|
|Wanzhou Existing Plant, Chongqing|
|Wanzhou New Plant, Chongqing||*150,000 (Started operations in Oct. 2011)||*150,000|
|Changan Bus||Dingzhou Plant, Hebei Province||*10,000||*10,000||Buses|
|Changhe Automobile||Changhe Suzuki||Jingdezhen Plant, Jiangxi province||100,000||200,000||Wagon R, Landy, Ideal A+|
|Jiujiang Plant, Jiangxi province||100,000||200,000 (2015)||Liana, Splash|
|Hefei Changan Automobile||Hefei New Plant||*150,000 (Started operations in Nov. 2011)||*300,000 (max. 400,000) (2nd phase started in 2013, operational in 2015)||Freedom, Fuyun|
|Hafei Automobile||Hafei Motor (Harbin Plant, Heilongjiang Province)||350,000||*500,000-600,000||Saima, Lobo, Saibao, Hafei Junyi, Hafei Minyi, Luzun, Minyi Pick-up, Zhongyi Pick-up, Alsvin V3|
|Weihai Branch office(Weihai Plant, Shandong Province)||50,000|
|Changan PSA||Shenzhen Plant, Guangdong Province||Construction started in Nov. 2011||*200,000 (Operational in the middle of 2013)||Planned: DS Line, PSA's Brand, Changan's Brand, Changan PSA's Brand|
|(Note) 1.||Production capacity marked with "*" is production capacity for commercial vehicles or production capacity including commercial vehicles.|
|2.||Jiangling Motors plans to move the production of Transit to Xiaolan Plant by August 2013.|
CKD sites outside of China
|Country||Business partners||Production bases||Models|
|Malaysia||Berjaya Corporation Berhad||Oriental Assemblers Sdn. Bhd. Location: Johor Baru||Benni (Local name: ERA CV6), CM8 (Local name: ERA CM8), Chana Star Truck (Local name: ERA Star)|
|Iran||Pars Industrial Development Foundation (PIDF)||Joint Venture Production Line||Benni|
|Nigeria||PAN Nigeria Limited||PAN's Plant Location: Kaduna||Alsvin|
|Vietnam||Ford Vietnam Ltd.||Haiduong Assembly Factory Location: Nam Sach, Hai Duong||Jiangling Motors exports CKD parts for New Generation Transit|
|Malaysia||Naza Group of Companies||Naza Automotive Manufacturing Sdn Bhd (NAM) Location: Gurun||Lobo (Local name: Naza Forza)|
|Vietnam||Vinamotor||Vinamotor's Plant||Trucks with one row of seat|
|Iran||KERMAN Group||KERMAN's Plant||Lobo, etc.|
Changan Kuayue Automobile
|Vietnam||Sanyang Motor Vietnam Co., Ltd.(SMV)||SMV's Plant||Xinbao|
|USA||Tiger Truck LLC||Joint Venture Plant Location: Poteau, Oklahoma||Star Leopard (Local name: Champ), Chana Star Truck (Local name: Star)|
Changan Automobile plans to construct new line in Paraguay
|In October 2012, Changan Automobile entered into a contract with a local company for the construction of a new production line in Paraguay. The companies will construct a production line to manufacture CVs under the Changan Motor brand. The local company will also be responsible for the sales of these vehicles establishing a sales network comprised of 27 retail stores including a flagship store within the next two years. This will be the first foreign OEM production line to be constructed in Paraguay.|
Hafei Automobile to begin KD production in 2014 in Brazil
|In August 2012, Hafei Automobile signed an agreement for technology transfer with an automobile import/export company, CN Auto, in Brazil. Hafei will provide technologies and KD parts and CN Auto will solely invest in the construction of the production line. CN Auto will be responsible for the KD productions as well as the sales of the vehicles. The production line with an annual production capacity of 50K units will be constructed in Espirito Santo, located in the southeast of Brazil by CN Auto. The construction will begin in 2013 on one million square meters of land with production to start in 2014. The first models to be manufactured will mainly be the Hafei Minyi series.|
|The automaker has been well received by the local drivers since its entry into the Brazilian market in 2005, making constant growth with the number of vehicles owned currently reaching over 40K units. It entered into a partnership with CN Auto in 2008 and has established a sales network with over 70 stores to date.|
Own brand division to strengthen R&D and aggressively launch new models
Establishment of worldwide R&D structure
In January 2011, Changan Automobile established its ninth R&D center in the U.S., completing its worldwide R&D structure. The OEM currently has R&D centers for its own brand, running in nine locations in five countries: China (Chongqing, Shanghai, Beijing, Harbin, and Jiangxi), Italy (Torino), Japan (Yokohama), the U.K. (Nottingham), and the U.S. (Detroit). Chongqing is acting as the headquarters of these centers, constructing site-wide plans and integrating its systems. The Shanghai center is responsible for process planning and global recruitment while the Beijing center will work on regulation and law compliances and R&D of new energy technologies. Additionally, centers in Harbin and Jiangxi will help support research and development for its group's brand OEMs like Hafei Automobile and Changhe Automobile.
Overseas sites will focus on designs (Italy), interiors and exteriors (Japan), powertrains (U.K.), and chassis (U.S.). These nine locations in five countries will collaborate in 24-hour operations to enhance the automaker's R&D structure. Through its worldwide R&D structure, Changan Automobile will strengthen its proprietary development capability while enhancing its corporate core competence.
Aims to expand market share by proactively launching new models
Since the beginning of 2012, Changan Automobile has been proactively launching its own brand models. A total of four brand models, including the Honor, the Eado, and the Alsvin V3, have been introduced by the end of September. Of these models, the Eado, a middle-end sedan launched in March, was the first showcased at the 2011 Frankfurt Motor Show where Changan Automobile was the only Chinese OEM to exhibit at the show. The design was done by the Italy R&D center, interior by Japan, chassis by the U.S. and powertrain by the U.K. The Honor and the Alsvin V3, as well as the Raeton are all engineered through these nine R&D centers to drive market competitiveness by launching its own brand models with global standards.
Changan Automobile's current and scheduled model launches
|Passenger Vehicles||Release Time||Outline|
|Eado||March 2012||A middle-end sedan. The model comes with a 1.6-liter naturally aspirated engine (maximum output of 92kW, maximum torque of 160Nm) under its own powertrain brand, the Bluecore. It incorporates a continuous intake and exhaust variable valve timing mechanism (DVVT) and start/stop mechanism (STT) from Bosch. The fuel economy is 6.2-liters/100km. It may be combined with either a 5-speed MT or Aishin's imported 4-speed AT with manual mode for its transmission. The targeted annual sales volume for 2012 is 45K units and ultimately, 100K to 200K units are expected to be sold in the future. The OEM is planning to provide an addition model with a 1.5-liter direct injection turbocharged engine combined with a DCT in 2013.|
|Alsvin V3||June 2012||Three years were spent for engineering this entry sedan. The model is powered by a 1.3-liter all-aluminum engine with Multi Point Injection (MPI). Maximum output is 69kW and maximum torque is 121Nm. Its fuel economy is 5.6-liters/100km.|
|Alsvin V5||September 2012||An economy sedan improved from the existing model, the Alsvin. It is powered by a Bluecore 1.5-liter engine with DOHC and DVVT technologies (maximum output of 84kW, maximum torque of 145Nm). The model comes standard with an on-board information system, In Call, which uses China Unicom's 3G service, the Wo.|
|CS35||October 2012||The first urban compact SUV solely engineered by Changan Automobile. This is a mass production model of the concept car S101, showcased at the 2011 Frankfurt Motor Show. The model was introduced at the Auto China 2012. It's built on the same platform as the Eado with a Bluecore brand 1.6-liter naturally-aspirated engine like the Eado. A 5-speed MT or Aishin's 4-speed AT with manual mode is available for its transmission. (CS35 with 4-speed AT will be released in early 2013)|
|Raeton||November 2012||A middle-/high-end sedan introduced at the Auto China 2012. 4,920mm×1,825mm×1,500mm (LxWxH) with wheelbase of 2,800mm. It is powered by either a 1.8-liter turbocharged engine or a 2-liter engine with a variable valve timing mechanism (VVT).|
|Commercial Vehicles||Release Time||Outline|
|Honor||February 2012||Compact MPV for corporate users. This model is intended for business and commuting for people working at small and medium-sized enterprises. Its biggest competitor is the Wuling Hongguang from SAIC-GM-Wuling Automobile. It comes with a 1.3-liter or a Mitsubishi 1.5-liter engine. The internal noise is low with 42dB during idle mode and 68dB when driving at 80km/h. Its interior space is 3,500-liter and the driver can choose from five, seven, or eight-seater versions.|
|New Chana Star||October 2012||The third generation of the minivan, Chana Star. 3,980mm×1,620mm×1,890mm (LxWxH) with wheelbase of 2,560mm. Equipped with a 1.2-liter engine with maximum output of 72kW and maximum torque of 119Nm. The model will be sold with the current Chana Star series.|
Jiangling Motor Holding's current and planned model launches
|Passenger Vehicles||Release Time||Outline|
|Landwind X5||Early 2013||The first urban SUV to be built on a monocoque body under the Landwind brand (internal code name E31). 4,568mm×1,855mm×1,708mm (LxWxH) with wheelbase of 2,660mm. A Mitsubishi 2-liter turbocharged engine, the 4G63T (maximum output of 130kW, maximum torque of 250Nm) and an 8-speed AT from Shengrui Transmission Co., Ltd. are combined. This is the first Chinese SUV with an 8-speed AT. The vehicle will be launched at the beginning of 2013 after it is introduced at the Auto Guangzhou 2012.|
Jiangling Motors' current and planned model launches
|Commercial Vehicles||Release Time||Outline|
|Yuhu||July 2013||A high-end pickup. The body measures 5,325mm in length, 1,828mm in width, 1,710mm in height for its two-wheel-drive version and 5,325mm in length, 1,905mm in width, 1,815mm for the all-wheel-drive version. The wheelbase length is 3,085mm for both versions. Powered with a gasoline engine or a 2.4-liter Ford diesel engine, the JX4D24. The model comes with a Bosch ABS with EBD (8.0 version) as its standard safety equipment.|
|J10||After second half of 2013||A pickup truck. It is engineered based on a platform used for the current pickup truck models.|
|N800||2013-2014||A medium-duty truck.|
|J12||After second half of 2014||A right-hand drive model engineered based on existing pickup truck to expand its market to overseas. The production is planned to start in the latter half of 2014. More than 39.3 million RMB will be spent on this model.|
Hafei Automobile's current and planned model launches
|Commercial Vehicles||Release Time||Outline|
|New Hafei Minyi||April 2012||A fully remodeled model of a commercial minivan, the Minyi. 3,735mm×1,510mm×1,890mm (LxWxH) with wheelbase of 2,370mm. Powered by a 970cc engine combined with a 5-speed MT. Its KD production is to start in 2014 in Brazil.|
Joint venture with Ford to make additional investment for launching new models
Chinese government approves the split plan of Changan Ford Mazda
In August 2012, Changan Automobile, Ford, and Mazda jointly announced that they have received an approval from the National Development and Reform Commission (NDRC) for the separation plan of their joint venture into two.
The announcement revealed that Ford and Mazda will each create a new joint venture with Changan Automobile with equally-split investments under this plan. With the split, both companies' shareholding will increase from the current three-way joint venture, giving them a stronger voice in the new joint ventures. However, the OEMs still need to go through an approval processes with the appropriate officials, such as the Ministry of Commerce and the State Administration for Industry and Commerce to complete the establishment of these new joint ventures.
Overview of separation plan
|Before the companies separate|
|Name of Corporation||Changan Ford Mazda Automobile Co., Ltd.|
|Investment Ratio||50% by Changan Automobile, 35% by Ford, 15% by Mazda|
|Location of Head Office||Chongqing|
|Production facilities||Vehicles: the Chongqing first, second, and third plants, Hangzhou plant, Nanjing plant *The Chongqing third plant and the Hangzhou plant are currently under construction Powertrains: Engine and transmission plants being constructed in Chongqing and an existing engine plant in Nanjing (Changan Ford Mazda Engine Co., Ltd.)|
|Models||Ford , Mazda , and Volvo brands|
|After the companies separate|
|Name of Corporation||Changan Ford Automobile (Changan Ford)||Changan Mazda Automobile (Changan Mazda)|
|Ownership Ratio||50% by Changan Automobile, 50% by Ford||50% by Changan Automobile, 50% by Mazda|
|Location of Head Office||Chongqing||Nanjing, Jiangsu|
|Production facilities (Plan)||Vehicles: the Chongqing first, second, and third plants, Hangzhou plant Powertrains: engine and transmission plants under construction in Chongqing||Vehicles: the Nanjing plant Powertrains: existing engine plant in Nanjing (Changan Ford Mazda Engine Co., Ltd.)|
|Models||Ford brands||Mazda brands|
|Note 1:||The construction of the Chongqing engine plant began in June 2011 in the North New Zone. The production is planned to begin in 2013 with an initial production volume of 400K engines. Added to 350K engines manufactured at the existing plant (Changan Ford Mazda Engine Co., Ltd.), the production capacity of Changan Ford Mazda as a group will reach 750K units.|
|2.||In addition to the engine plant, the construction of a transmission plant began in Chongqing in September 2011. The plant will start productions of 6-speed ATs used on models produced at the Chongqing plant from the fourth quarter of 2013. Its initial annual production capacity will reach 400K units. This is the first transmissions plant for Changan Ford Mazda.|
|3.||The production sites after the separation are based on news reports and are not announced officially. Since Mazda is also investing in the Hangzhou plant, some report that the company the plant will be organized into is still unconfirmed.|
|4.||The Fiesta currently manufactured at the Nanjing plant will be transferred to a Changan Ford plant after the separation.|
Ford to increase its investment into Chinese market
Ford announced that it will launch 15 new models, and 20 state-of-the-art powertrains by 2015 in the Chinese market and it is aggressively constructing new plants with its local partners. The construction of engine and powertrain plants began in Chongqing in 2011. In addition to the production starting at the Chongqing second plant in February 2012, the construction of the Chongqing third plant and the Hangzhou plant started in August. The amount invested into these new projects exceeds 3.1 billion dollars.
Of the 15 new models, the first model, the New Focus, was released in April 2012. The table below is an overview of new models scheduled to be released, including the high-end brand, the Lincoln, which was announced to be launched in the latter half of 2014. It also includes estimates based on media reports.
|Introduction Form||Models||Release Time||Outline|
|Local Production||all-new Ford Focus||April 2012||The third generation of the Ford Focus manufactured at the Chongqing second plant. In May 2012, it released the Jingdian Focus, an improved version of the previous Focus, which is now sold along with the old model. The new version targets the high-end share and the old version, the middle-end in the mid-class vehicle market.|
|all-new Ford Kuga||November 2012||The third generation of the compact SUV Ford Kuga (a Chinese model of the Escape). The locally produced model was made public in October 2012 in Beijing. It uses a 1.6-liter or 2-liter EcoBoost turbocharged engine. It is equipped with a telematics system, the SYNC, and a human machine interface (HMI), the MyFord Touch. Expected to be introduced at Auto Guangzhou 2012.|
|all-new Ford Ecosport||Early 2013||The second generation of the compact SUV, the Ford EcoSport. The production will start at the end of 2012 at the Chongqing second plant, and released into the market by early 2013. It is powered by either a 1-liter, 3-cylinder EcoBoost engine or a 1.5-liter engine with a continuous intake and exhaust variable valve timing mechanism (Ti-VCT).|
|all-new Ford Transit||2015||A fully remodeled Classic Transit. It will be manufactured at the Jiangling Motors' Xiaolan plant in which Ford has a stake of 30% as the second biggest shareholder.|
|U375||2015||Ford's new SUV built on the T6 platform. The model will be produced at Jiangling Motors' Xiaolan plant.|
|Import||Explorer||2013||A medium-size SUV. It uses a 3.5-liter, V6 engine with a Ti-VCT mechanism. Initially the model will be imported and then switched to a local production at Jiangling Motors in 2015. It will be equipped with an electric control system, the Terrain Management System, which allows the driver to select an optimized setting for the all-wheel-drive.|
|All-new Ford Focus ST||2013||The third generation of the Ford Focus ST, showcased at the 2012 Auto China for the first time in Asia. This is the high performance version of the Ford Focus. Powered with a 2-liter, 4-cylinder EcoBoost engine, combined with a 6-speed MT. The model will be manufactured at Ford's Germany plant and exported to the Chinese market.|
|Introduction Form||Models||Release Time||Outline|
|Import||MKZ/MKS/MKX/MKT/ Navigator||The second half of 2014||It is reported by the media that these five models will be released. Of these five, the MKZ is most likely to be manufactured locally.|
Note: In addition to the models above, the local media reports that Ford is planning to introduce fully remodeled versions of the Mondeo and S-Max, a face-lifted/fully remodeled version of the Fiesta, and a locally produced version of the Edge. In addition to the existing models, new models such as the Ka (based on the concept car, the Start), Taurus, Mustang, B-MAX, C-MAX, Galaxy, and Flex are also expected.
Ford to enter into truck market
In August 2012, Jiangling Motors, which Ford owns 30% as the second largest shareholder, announced that it will merge Chang'an Heavy Vehicle (Taiyuan in Shanxi Province) into its group. With this merger, Chang'an Heavy Vehicle, previously directly owned by Changan Automobile Group (owned 80% by Changan Automobile Group and 20％ by China South Industries Group Corporation), will become Jiangling Motors' wholly owned subsidiary. Jiangling Motors is thought to have received much support from Ford with this merger, and the media reports that there is a high possibility that Ford trucks will hit the Chinese market in the future.
Joint venture with PSA begins import sales of DS Line
In November 11, Changan Automobile Group and PSA established a joint venture, Changan PSA Automobiles Co., Ltd. (Changan PSA) in Shenzhen, Guangdong Province. The capital funding of four billion RMB will be split equally by the two companies. The company currently sells Citroen's high-end series, the DS Line, only, and the local production is scheduled to begin in mid-2013. Both companies feel that the current car owners in China, especially in the high-end segment, are more focused on originality, and aim to expand its market share with the release of the DS Line characterized by its unique design.
Model launch plans
|First phase: Import sales||The import sales of the B-class DS5 and the A-class DS4 began in June 2012, and A0-class DS3 in September. This was the first time Citroen's DS Line was launched into the Chinese market.|
|Second phase: Local production||By mid-2013, the productions at the vehicle plant will start with the local production of the DS Line. The scheduled initial local production rate is 50%. The production will begin with the DS5 terminating the import after the manufacturing starts locally.|
|Third phase: Launching of existing and new brands||Changan Automobile Group and PSA's group brand and Changan PSA original brand models are planned to be released in the future.|
Organizing production facilities
|Vehicle Plant||Changan PSA took over Hafei Automobile's Shenzhen plant, which terminated production in June 2007, to establish a new production site based on this plant. Its property reaches 1,300,000 square meters with the addition of a newly acquired industrial site. It is reported that the production facilities for the DS Line will be newly constructed and the Hafei Automobile's existing facilities and land will be used for the production of joint venture's own brands. The plant will be ready and start production with an initial annual capacity of 200K vehicles by mid-2013.|
|Engine Plant||The construction of this plant began in May 2012 south of the vehicle plant. The plant will be built on approximately 24,500 square meters of land. Four machining lines and an assembly line will be built in the first phase of the construction. Its planned initial annual production capacity is 200K units.|
|R&D Center||A new R&D center is currently under construction along with the vehicle and the engine plants. It will share technical resources with the existing R&D centers of Changan Automobile Group and PSA.|
Establishment of sales network
|Since opening a specialized store, DS Store, in June 2012 in Nanjing, nine new stores have been opened in cities including Shenzhen, Shanghai, and Guangzhou. 24 more DS Stores are planned to be opened in 24 major cities by the end of 2012. Then, it will expand its sales network to 80 stores in 55 cities by the end of 2013, 130 stores in 75 cities by the end of 2014, and 200 stores in 111 cities by the end of 2015. Its goal is to reach production and sales volumes of one million units by 2020.|
Production and sales of joint ventures with Japanese OEMs (Suzuki and Mazda) affected by anti-Japanese protests
Due to anti-Japanese protests in September, Changan Suzuki's Chongqing plant cut production, limiting it to the daytime only. Chongqing Ford Mazda's Nanjing plant, which produces Mazda brand vehicles, went into a break for the National Day of the People's Republic of China two days earlier, explaining that the shutdown was to prepare for the production of the CX-5 scheduled to be launched in 2013. On October 8, the day the break ended, both plants were confirmed to have started normal operations, but the situation continues to be uncertain.
With the downfall of all Japanese brands, sales volumes on a single month basis for September dropped for both Mazda and Suzuki's joint ventures. The sales volume for Changan Suzuki dropped 48.3% y/y to 10,649 and that for the locally produced Mazda2 and Mazda3 dropped 27.7% to 4,299 units for Mazda (data based on factory shipments).
Despite the slow sales, Mazda released face-lifted vehicles, and Suzuki released new models in October. The table below is a summary of launching plans of new models by both companies.
Mazda' current and planned model launches
|New Mazda2||October 2012||A face-lifted version of the third generation of the Mazda2 (Demio in Japan). Its face design has been changed with a wider front grille. The model was pre-released on September 22 in Jiangsu Province where its Nanjing plant is located.|
|CX-5||2013||A crossover SUV with a new generation of technology, SKYACTIV TECHNOLOGY. The model was first introduced in China at 2012 Auto China. The import sales of this vehicle has already begun in July though Changan Ford Mazda's sales networks and the local production is set to begin in its Nanjing plant in 2013.|
|New Mazda3||2014||The third generation of the Mazda3 (Axela in Japan). It is reported that it will be introduced outside of China in mid-2013 and the local production to begin in China by 2014.|
Suzuki' current and planned model launches
|Beidouxing X5||October 2012||A crossover compact car based on the existing Wagon R produced at Changhe Suzuki. 3,664mm×1,610mm×1,722mm (LxWxH) with wheelbase of 2,485mm. Its interior space is 3,230-liters with a luggage space of 890-liters. Powered with a 1.4-liter K14B (maximum output of 70kW and maximum torque of 112Nm) engine combined with a 5-speed MT.|
|Ertiga||n.a.||A seven-seater MPV. Media reports that it may be locally produced at Changan Suzuki.|
Note: Changan Suzuki will launch seven new models including the Ertiga, an SUV, and a B-class vehicle by 2015.
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