Dongfeng Motor strengthens proprietary & JV brand businesses

Sales target of 5 million units for 2015, starts JV with Renault

2014/01/10

Summary

Changes in Chinese market shares of Dongfeng Motor A leading Chinese automaker, Dongfeng Motor Corporation  achieved the second largest market share in the sales of vehicles manufactured in 2012. The company is strengthening the proprietary and JV brand business  and alliances with foreign-affiliated automakers. The company aims to achieve sales of 5 million units and a 20% share in the Chinese market by 2015 (the unit sales and the market share in 2013 are estimated to be 3.3 million units and 16% respectively). This report summarizes the company's sales targets, model plans, production enhancement, and the details of proprietary and JV brand business of affiliate companies.


Note:
 (1) The "proprietary brands" include  "Dongfeng" and Dongfeng Yulon Motor's "Luxgen."
 (2) The "JV brands" are new proprietary brands of joint ventures which are developed by the foreign-affiliated joint ventures in China with the JV's  intellectual property rights. These brands include "Venucia" of Dongfeng Nissan Passenger Vehicle Company and "Horki" of Dongfeng Yueda Kia Motors.



Related Reports:



Sales target: From 3.3 million units in 2013 to 5 million units in 2015

 Dongfeng Motor Corporation has set the Group's sales target (on factory shipment basis  including exports and commercial vehicle chassis) from 3.3 million units in 2013 to 5 million units in 2015. Of the above sales, the sales of proprietary and JV brand passenger cars account for 36% of the total group sales at 1.8 million units.

 In terms of the sales by joint venture, it has been reported that Dongfeng Nissan Passenger Vehicle Company, a division of Dongfeng Motor Co., Ltd. aims to sell more than 2 million units of light vehicles.Dongfeng Peugeot-Citroen Automobile Co., Ltd. aims to sell 800,000 units in 2015. Likewise, Dongfeng Honda Automobile Co., Ltd. aims to sell 350,000 units in 2014 and 1 million units in 2023, and Dongfeng Yueda Kia Motors Co. Ltd. aims to sell 1 million units in 2016.

Dongfeng Motor: Annual sales plans and targets by major subsidiary

OEM
(Joint capital)
Sales Plans and Targets
    Dongfeng Motor        
    Corporation

    (The JV partners:
    Renault-Nissan,
    AB Volvo and UD Trucks,
    Honda, PSA, Kia,
    and Yulon Motor)
* In 2013: total of passenger cars and commercial vehicle: 3.3 million units (value planned in early 2013, which include exports of 100,000 units)
breakdown * passenger car: 2.6 million units
* commercial vehicle: 700,000 units
* In 2015: total of passenger cars and commercial vehicle: 5 million units
* proprietary and JV brands passenger cars, 1.8 million units
* In 2016: N/A (including commercial vehicle: 3 million units)
* proprietary and JV brands: total of passenger car and commercial vehicle: 3 million units (it recorded the third highest sales in China in 2012 at 1.13 million units)
By
market
* Chinese market: Passenger car and commercial vehicle: 2.7 million  units
* Foreign market/Export: passenger car and commercial vehicle 300,000 units (result in 2011: 63,800 units)
* Foreign general market: 90,000 units
* Foreign strategic market: 210,000 units (foreign subsidiaries, joint ventures, regional operation centers, knockdown plants, etc.)
By
brand
* Dongfeng (proprietary) brands: passenger car: 1 million units
* Luxgen (proprietary) brands: passenger car: 250,000 units
* JV brands: passenger car: 750,000 units
* Dongfeng brand: commercial vehicle: 1 million units
Dongfeng Motor Group Co., Ltd. * in 2013: total of passenger and commercial vehicle: from 2.3 million to 2.35 million units (result in 2012: about 2.16 million units)
breakdown * passenger car:1.9 million-1.94 million units
* commercial vehicle: 400,000-450,000 units
* in 2015: N/A
* proprietary and JV brands: passenger car and commercial vehicle: from 1.8 million to 2 million units
Dongfeng Motor
Co., Ltd.
(Nissan)
* in 2015: Light Vehicle: over 2 million units
* Dongfeng brand: the target is 1 million units
Dongfeng Nissan Passenger Vehicle division
(Nissan, Yulon Motor)
* in 2013: passenger car: 900,000 units (including exports of 80,000 -100,000 units, and Venucia brand cars 100,000 units)
* in 2014: passenger car: over 1 million units  (To start local production of the Infiniti for two models. The Dalian plant will start operations.)
* Venucia brand: passenger car: about 150,000 units
* in 2015: passenger car: 1.4 million-1.5 million units
* Venucia brand: passenger car: 300,000-400,000 units
* in 2016: N/A (including over 100,000 units of the Infiniti)
* in 2017: N/A (including 200,000 units of the Infiniti)
  The Venucia brand is eyeing cumulative sales of 1 million units.
Dongfeng
Automotive Co., Ltd.
* in 2013: Light Vehicle: 294,000 units
* in 2014: Light Vehicle: about 500,000 units
Zhengzhou
Nissan
Automobile Co., Ltd.
(Nissan)
* in 2013: Light Vehicle: 121,000 units (including 10,000 units of exports)
* in 2016: Light Vehicle: 300,000 units (released in May 2012)
Changzhou
Dongfeng
Automobile Co,. Ltd.
* in 2014: Light Vehicle: about 200,000 units (share of mini-type vehicle is 5%)
Dongfeng Honda
Automobile Co., Ltd.
(Honda)
* in 2014: passenger car: 350,000 units (Expected to be 300,000 units in 2013)
* in 2023: passenger car: 1 million units
Dongfeng-Puegeot-
Citroen Automobile Co. Ltd.
(PSA)
* in 2013: passenger car: over 500,000 units
breakdown Citroen brand: about 260,000 units
Peugeot brand: about 240,000 units
* in 2014: Peugeot brand N/A, Citroen brand 305,000 units
* in 2015: passenger car: 800,000 units
  Note: It has been reported so far that the company aims to sell 750,000 units or approximately 1 million units by 2015 (estimated from the company's target share of 5% in the Chinese market with the total vehicle sales of 20 million units in 2015).
breakdown * Citroen brand: 400,000 units
* Peugeot brand: 400,000units
Dongfeng Renault
Automotive Co. Ltd.
(Renault)
* N/A (To start local production of SUV in 2016) Renault aims to import and sell 100,000 units in 2015.
Dongfeng Passenger
Vehicle Co. Ltd.
* in 2013: 100,000 units (passenger car only, the same shall apply below; Results in 2012: 60,000 units)
* in 2015: 300,000 units
* in 2016: 350,000 units
  Target cumulative sales from 2012 to 2016: 1 million units (including 90,000 units in cumulative total exports from 2013 to 2016)
* in 2017: 566,000 units
Dongvo (Hangzhou)
Truck Co., Ltd.
(UD Trucks)
[Former Dongfeng
Nissan Diesel Co.,Ltd.]

* N/A
  (To establish the annual production capacity of 50 million units for heavy-duty, dump, and tractor trucks in 2014)
  Note: The company aims to start supplying vehicles in the second quarter of 2014. The sales performance of its predecessor Dongfeng Nissan Diesel Motor in 2012 was 500 units.
Dongfeng Motor
Commercial Vehicle
Co., Ltd.
  (This company 
   plans to form a JV
   with AB Volvo.The 
   company name will
   be changed to   
   Dongfeng Volvo 
   [Tentative name].
Dongfeng Liuzhou
Motor  Commercial Vehicle Company division
* in 2013: Medium/Large-type truck: over 180,000 units
breakdown Dongfeng Motor Commercial Vehicle: over 145,000 units
Dongfeng Liuzhou Motor Commercial vehicle:  about 35,000
* in 2015: Medium/Large-type truck over 300,000
Dongfeng Liuzhou
Motor Passenger Car Company division
* in 2013: 180,000 units (passenger car only)
* in 2015: 230,000 units
* in 2016: 300,000 units
Dongfeng-Yueda-Kia Motors Co., Ltd.
(Kia)
* in 2013: 520,000 units (passenger car only, the same shall apply below)
* 2014: 10% increase YoY, estimated at 600,000 units
* 2016: 1 million units
  (In July 2012, the company had reported its sales target for 2016 as 800,000 units with a 4% share of the Chinese passenger car market.)
Dongfeng Yulon Motor Co., Ltd.
(Yulon Motor in Taiwan)
* 2013: 40,000 to 55,000 units (Luxgen brand passenger car only, the same shall apply below)
* 2015: 200,000 units (reported in December 2012, with sales target of CNY 25 billion )
* 2016: 250,000 units
Dongfeng Xiaokang
Automobile Co. Ltd.
[former Dongfeng
Yu'an Vehicle Co.,Ltd.]
* 2013: 335,000 units (mini/small passenger car )
Mini/small passenger car: about 200,000 units
* 2017: 1 million units

Note: Honda has Dongfeng Honda, GAC Honda, and Honda Automobile (China) as its joint ventures in China. With the three joint ventures in total, Honda has declared its mid- to long-term goal to surpass Nissan in the unit sales in China and further to catch up with VW as a competitor. (Source: Interview report in November 2013)

 

 



Strengthening alliances with Renault-Nissan and PSA

Joint production system with Renault: reorganizes Sanjiang Renault Automotive to establish a new joint venture

 In December 2013, Dongfeng Motor Group Co. Ltd. and Renault signed an agreement to form a new 50-50 joint venture, Dongfeng Renault Automotive Co., Ltd. (DRAC), by reorganizing Sanjiang Renault Automotive Co., Ltd. (Xiaogan, Hubei Province) that had suspended production.
 The new joint venture will be established in Wuhan, Hubei Province (at the Huangjinkou Industrial Park in the Economic and Technical Development Zone) with a total investment of CNY 7.76 billion, which is equivalent to EUR 870 million. The joint venture plans to commence construction of the plant (Phase 1) in December 2013 and to start production in 2016.
 The new plant will include an annex engine plant and R&D Center as well as press/welding/painting/assembling production facilities. The painting facility will be manufactured by Taikisha Ltd. in Japan (on order). The vehicle plant has a gross area of 950,000 square meters. The annual production capacity after the first phase  construction is 150,000 units of SUV/MPV (and 150,000 units of engines). The second phase construction will start in about 2017 to expand the annual production capacity to 300,000 units of passenger cars (and 600,000 units of engines). The plant plans to hire 2,000 employees.
 The joint venture plans to start production of the company's first production model, SUV Koleos, and then the Renault brand SUV/MPV, new energy models including EV, and JV brand vehicles owned by both partners (It is reported that Dongfeng logo is most likely to be adopted). The license for domestic and overseas production and sales of vehicle models produced by the joint venture including JV brands will be granted by Renault in the near future. Sanjiang Renault Automotive and the reorganized Dongfeng Renault plan to produce sedan but do not possess a production license for vehicle models other than SUVs and MPVs. They plan to apply for the relevant production license.
 The joint venture with Renault plans to increase sales by promoting the sharing of components including platforms and powertrains to enhance the competitiveness of its products.The JV will fully use Missan's existing business channels in China for production, sales, and procurement. (The number of Renault brand vehicles in China as of December 2013 exceeds 100,000 units.)
 On the other hand, the Xiaogan Plant of the reorganized Sanjiang Renault Automotive will be reformed into a plant supplying powertrains such as engines and transmissions. Renault increased its dealers in China to 110 stores at the end of 2013, and plans to additionally launch an imported light-duty SUV Captur in 2014.

 

Joint venture with Nissan reorganizes the Zhengzhou Vehicle Plant of Zhengzhou Nissan

 Dongfeng Automobile Co., Ltd. announced in November 2013 that Dongfeng Nissan Passenger Vehicle Company will acquire and reorganize the Zhengzhou Vehicle Plant of Zhengzhou Nissan Automobile Co., Ltd. The plant began operations in 2010 and started construction of its annex engine plant in October 2011. The company will acquire the plant with CNY 1.1 billion through its parts subsidiary in Zhengzhou, "Guangzhou Fengshen Automobile Zhengzhou Office."
 The reorganized Zhengzhou vehicle plant covers 155,000 square meters  and is built on a site of 436,000 square meters. The plant includes welding,painting. and assembly facilities. Its annual production capacity of passenger cars is 200,000 units as of November 2013 (the production capacity of the annex engine plant is unknown). The annual production capacity of the Zhengzhou vehicle plant for the passenger cars is expected to be increased from the present 200,000 units to 450,000 units (and 600,000 units of engines) by 2015.
 Since operations began in April 2012, the Zhengzhou vehicle plant has been producing the Venucia JV brand passenger car series (the D50, R50, etc.) as well as the contract production of SUVs consigned by the Guangzhou Plant of Dongfeng Nissan Passenger Vehicle Company.
 The Guangzhou Fengshen Automobile Zhengzhou Office is engaged in the production of control units for disc brake, combination instrument, AT, electronic device, engine andchassis, and in the development of core technologies for the control units. Dongfeng Nissan Passenger Vehicle Company will increase the annual production capacity of the Xiangfan Plant in Hubei Province from the present 200,000 units to 250,000 units in 2014 when the company starts local production of Infiniti brand models. The company will also start operations of the Dalian Plant in Liaoning Province to increase the annual production capacity of passenger cars by 150,000 units. The company will further increase the annual capacity of the two plants in Guangzhou from the present 670,000 units to 700,000 units in 2015 to expand total annual production capacity of Dongfeng Nissan Passenger Vehicle Company to 1.3 million units, combined with the capacity of the Zhengzhou, Dalian, and Xiangfan Plants.

 

Development commissioned from Nissan/Renault for cabins of light-duty trucks and production of their components
 In December 2013, Dongfeng Automobile Co., Ltd. announced that it received an order from its alliance partner, Nissan, for the development and supply of the left-handle cabins and their components for Nissan/Renault's light-duty truck the "F91G" based on data from Nissan Shatai. The transaction amount between Dongfeng Automobile Co., Ltd. and the Nissan Group for the above business for the period from January to October 2013 was CNY 520 million in total.

 

Negotiation on capital participation in PSA: Agreement on joint development of affordable small cars for Southeast Asia

 Dongfeng Motor Corporation reported in December 2013 that it had negotiated with PSA toward the acquisition of 17.6% of the PSA's total share at approximately EUR 3 billion to EUR 4 billion through the company's subsidiary, Dongfeng Motor Group Co., Ltd., and that the companies reached a basic agreement. (In September 2013, the company had reported that it was under negotiations with PSA toward the acquisition of 30% of the PSA's total share at CNY 10 billion through the Dongfeng Motor Group Co., Ltd.)
 The final result of the negotiation is expected to be announced by March 2014. If this stock transaction goes through, the Dongfeng Motor Group Co., Ltd.will become a (top) principal shareholder comparable to the French government. However, they reportedly only have agreed at the present stage that the two parties will jointly develop affordable small cars to develop the auto market in Southeast Asia.
 PSA, which suffered from sluggish sales due to its overdependence on the domestic market in France, has set a target to increase the overseas sales to 50% of the group sales in 2015. Particularly, PSA has set a goal to increase the sales in the Southeast Asia market and started experimental exports in 2011 with an ongoing expansionary exports of passenger cars manufactured by Dongfeng Peugeot-Citroen Automobile Co.,Ltd. (The export performance was 3,129 units in 2011, 3,528 units in 2012, and 1,769 units for the period from January to October 2013.)

 

 Meanwhile, the joint venture between the Dongfeng Motor Group Co., Ltd.and PSA, Dongfeng Peugeot-Citroen, opened the third passenger car plant in Wuhan in early July 2013 to start the production of the fully- redesigned new Elysee. As a result, the annual production capacity of Dongfeng Peugeot-Citroen increased by 150,000 units from 450,000 units to 600,000 units with the three plants' capacities combined. Dongfeng Peugeot-Citroen plans to further increase the production capacity to 750,000 units in 2015 by expanding the third plant.


 For the latest trends of "Dongfeng Yueda Kia Motors Co., Ltd.," of which Dongfeng Motor Corp. holds a 25% share, see the MarkLines research report "Hyundai-Kia in China: 2.4 million in vehicle sales targeted for 2016" (November 2013 issue).

 

Plans to make Fujian Motor wholly-owned subsidiary: Acquires a 45% share as the first step

 In May 2013, Dongfeng Motor Corporation signed a memorandum for capital participation in Fujian Motor Industry Group Co., Ltd. engaged in joint production with Mitsubishi, China Motor Corporation, and Daimler. As of November 2013, the company is in the process of assessment of assets to accelerate share transfer. (The alliance partners are expected to launch the first alliance model in 2015.)
 This will enable Dongfeng Motor Corporation to expand the proprietary and JV brand business by incorporating the proprietary brands such as the "Southeast" under the Fujian Motor. Dongfeng Motor Corporation will capitalize on the favorable sitting conditions of the Soueast area (coastal area) to further expand overseas business. Meanwhile, this alliance will enable the Fujian Motor to strengthen its product competitiveness through the synergistic effect of using the business resources of Dongfeng Motor Corporation.
 Dongfeng Motor Corporation will acquire a 45% share of the Fujian Motor through an increase in capital. It will also establish a new share holding company for Soueast Motor as a 50-50 joint venture with the Fujian Motor. Dongfeng Motor Corporation will hold two thirds of the share of the new holding company with the transferred shares of Soueast Motor and the newly added shares from the capital increase. Fujian Motor will hold the remaining one third.
 According to the Fujian Motor, Dongfeng Motor Corporation had announced a plan to acquire a 40% share of the Fujian Motor in December 2012 as Phase 1 of the capital participation plan. Dongfeng Motor Corporation had intended to further increase the shareholding of the company from 40% to 60% if the annual sales of the Fujian Motor exceeded 300,000 units.

 

JV alliance with AB Volvo/UD Trucks on medium-duty and heavy-duty commercial vehicle business

 Dongfeng Motor Corporation is advancing the reorganization and JV alliance with AB Volvo for the medium-duty and heavy-duty commercial vehicle businesses through its subsidiary, Dongfeng Motor Group Co.,Ltd.. The two automakers will advance joint production and sales of "Dongfeng" brand vehicles through a joint venture expected to be established in Shiyan, Hubei Province. The automaker will also produce medium-duty and heavy-duty commercial vehicles with the "UD" and "Volvo" brands through a joint venture with the established UD Trucks in Hangzhou, Zhejiang Province.

 

Alliance with AB Volvo: establishes a new JV to produce "Dongfeng" brand vehicles
 Dongfeng Motor Corporation is reorganizing its medium- and heavy-duty commercial vehicles business with AB Volvo through the Dongfeng Motor Group Co., Ltd. In January 2013, the two companies signed an agreement for a strategic alliance on the assumption of establishing a joint venture production company. The two companies will establish the world-class "Dongfeng" brand by enhancing the commercial vehicle business while strengthening the brand power of the Volvo Group including UD/Volvo.
 At the same time, Dongfeng Motor Group Co., Ltd. dissolved the joint venture alliance with Nissan in the medium- and heavy-duty business in January 2013. Dongfeng Motor Group bought back all the shares held by Nissan in the commercial vehicle division of the joint venture with Nissan, "Dongfeng Motor Commercial Vehicle Co. Ltd.," at CNY 5.3 billion. Also in January 2013, the commercial vehicle division was integrated into a wholly-owned commercial vehicle subsidiary which was established in the same month, "Dongfeng Commercial Vehicle Company."
 Dongfeng Motor Group Co., Ltd. and AB Volvo will establish a joint venture with the tentative name of "Dongfeng Volvo Truck Co., Ltd. (DFCV)" in Shiyan, Hubei Province, with Dongfeng Commercial Vehicle Company as a parent organization. The approval of the incorporation is expected to be obtained from the Chinese government in as early as January 2014. AB Volvo will acquire a 45% share of the joint venture at CNY 6.5 billion with the remaining 55% held by Dongfeng Motor Group.
 The two companies will share business resources including technologies and build cooperative business structures by bringing out the best strengths of each other through the joint venture. They will produce and sell "Dongfeng" brand medium- and heavy-duty commercial vehicles.
 Dongfeng Motor Corporation explained that  the company aimed to absorb marketing and management capabilities in overseas markets, and did not place much importance on obtaining the products and technologies of medium- and heavy-duty commercial vehicles. The truck sales of AB Volvo in China in 2012 stayed flat at 2,000 units. The number of dealers of AB Volvo as of December 2013 was 20.

 

Launches a Quester-based heavy-duty commercial vehicle in 2014 produced at the JV  plant formed with UD Trucks in Hangzhou
 After Nissan Diesel changed its name to UD Trucks, the 50-50 joint venture (former Dongfeng Nissan Diesel Motor Co., Ltd. [Hangzhou City, Zhejiang Province]) established between the Dongfeng Motor Group Co., Ltd. and the former Nissan Diesel also changed its name to Dongvo (Hangzhou) Truck Co., Ltd. in November 2013. This company is in the process of reorganization by switching the production method for medium- and heavy-duty commercial vehicles from the conventional completely knocked down (CKD) method to the completely local production.
 Dongvo (Hangzhou) Truck, which is expected to belong to DFCV, announced in December 2013 a new heavy-duty truck under the "UD" brand, "KuTeng." This is the first production vehicle launched after the reorganization. It adopts the "T-ride" rear suspension technology that was developed based on the platform of the Quester, the UD Trucks' new heavy-duty truck for emerging markets (announced in June 2013 in Thailand). The KuTeng is mounted with 11L displacement engine. The company plans to have an annual production capacity of 5,000 units.
 This model is designed for various usages such as long-distance transportation, intra-city distribution, dangerous goods transportation, construction sites, and public works. It is available in a wide lineup such as 4x2, 6x2, 6x4, 8x4 driving wheels and tractor truck. The model is designed for the Chinese high-end heavy-duty commercial vehicle market with sales price of CNY 400,000 to CNY 500,000. The automaker aims to start delivery of the model in April to June 2014.

 

 



Strengthening of proprietary and JV brand business

 Dongfeng Motor Corporation sets a goal for the group's future proprietary and JV brand business that its commercial vehicles rank top in the domestic market and rank third in the global market, and that its passenger cars enter the top group in the global market. Among the group companies, Dongfeng Motor Automobile Co., Ltd., which is the principal body for the group's proprietary brand light-duty CVs, aims to enter one of the top two positions in the Chinese light-duty CV market share by 2014. In addition, Dongfeng Motor Corporation plans to further strengthen the group's proprietary and JV brand business with an eye on absorbing the Fujian Motor Industry Group that owns the "Soueast" proprietary brand. As a sales target of proprietary and JV brand vehicles for the whole group, Dongfeng Motor Corp. aims to achieve sales of  1.8 million units of passenger cars in 2015,  2 million units of passenger cars  in 2016, and 1 million units of commercial vehicles in 2016.

Mid-term five-year plan for the group's proprietary and JV brand business (up to 2016)

 Dongfeng Motor Corporation is promoting a mid-term five-year plan (2012-2016) for the proprietary and JV brand business including Luxgen, Venucia, and Horki. It plans to invest CNY 30 billion in the capacity expansion of the businesses. With this investment, the company aims to achieve the sales target for 3 million units by 2016 as well as strengthening the independent development fields by allocating more than 3% of the sales amount to the research and development of proprietary and JV brand new vehicles.

 

 Of the group companies, Dongfeng Automobile Co., Ltd. launched specific measures to shift to the policy for proprietary brand businesses such as improving the marketability, productivity, and marketing capabilities of proprietary brands. The measures were announced as below when sales target (294,000 units) was announced in February 2013:
  1. Upgrading of existing production models and addition of new high-end models;
  2. Upgrading of product  and sales service quality and efficiency including production efficiency and
      durability;
  3. Construction of efficient sales channels, improvement of inventory and distribution efficiency, and
     expansion of sales services leading to high profitability.

 

Scope of the group's proprietary and JV brand business
 Among the proprietary brands of the group, the passenger cars include the Fengshen series of Dongfeng Passenger Car, the Futurn series of Dongfeng Liuzhou Motor, the Fengdu series of Zhengzhou Nissan, the Dongfeng Xiaokang series of Dongfeng Yu'an Automobile, and the Luxgen series of Dongfeng Yulon Motor. The group's proprietary brand commercial vehicles include the Dongfeng brand light-duty commercial vehicles of Dongfeng Automobile Co., Ltd./Zhengzhou Nissan/Dongfeng Changzhou, and the Dongfeng brand medium- and heavy-duty trucks of Dongfeng Commercial Vehicle (integrated into Dongfeng Volvo) and Dongfeng Liuzhou Motor.
 The group's JV brands include the Venucia brand of Dongfeng Nissan Passenger Vehicle Company, the Horki brand of Dongfeng Yueda Kia Motor, and the Ciimo model (brand name yet-to-be-announced) of Dongfeng Honda. The JV brands also include new brands, other than foreign-owned brands, with the intellectual property right belonging to joint ventures such as Peugeot,Citroen, and Renault. The new brands are expected to be launched according to plans by Dongfeng Peugeot-Citroen or Dongfeng Renault.
 If the Fujian Motor Industry Group is absorbed in the future, the Fujian's proprietary and JV brand including the "Soueast" brand will be incorporated into the business of the Dongfeng Motor Corporation (The sales performance of the "Soueast" brand light vehicles was 107,000 units in 2012 except the Fujian's proprietary brand buses such as "King Long," of which the sales of passenger cars was 103,000 units.)


 

Model plans of major group companies by proprietary and JV brand

OEM Details
Proprietary and JV brand model
plans of Dongfeng Motor Corporation
(2012-2016)

Note: Excerpts from
announcement
in April 2012
<Passenger car>
 Dongfeng proprietary brand's new models (18 sedan and hatchback models in total, three mini vehicle series) will be developed and additionally released (A lineup of three engine series and four transmission series will also be developed).
 Under the Fengshen brand, three platforms and a total of nine new vehicles (and six types of Dongfenge-TECO series engines) will be developed and released during five years from 2012 to 2016.
<Commercial vehicle>
 Under the Dongfeng brand, 14 platforms (including four core parts such as engine and transmission) will be developed and additionally released (including the "Dongfeng" brand medium- and heavy-duty commercial vehicles that adopt the technologies of AB Volvo/UD Trucks group).
Proprietary
brand
Dongfeng Automobile Co., Ltd. ▽Dongfeng brand (light-duty truck)
* 2013:
 Facelift of existing major light-duty trucks under Dongfeng brand (such as Kaipute/Duolica/Furuika/Rio Tinto series) (improvement of 40 items)
 High-end commercial vehicles mounted with a night-viewer (making the range of 50m forward and 70m backward always visible) and MP5 audio device
Zhengzhou Nissan Automobile Co., Ltd. ▽Dongfeng brand: Fengdu series
Dongfeng Liuzhou Motor Co., Ltd. ▽Dongfeng brand: Futurn series
Dongfeng Passenger Vehicle Company (a division of Dongfeng Motor Group Co., Ltd.) ▽Dongfeng brand: Fengshen series
* Releases a total of five vehicles and a dozen models from 2010 to 2014 including medium-duty, medium-end/high-end vehicles. Builds a production capacity for two series of engines with a displacement of 1.4L to 1.6L and 2.0L to 2.4L.
* 2014: To release three new models in total (sedan, EV, new SUV)
Dongfeng Yu'an Vehicle Co., Ltd. ▽Dongfeng brand: Dongfeng Xiaokang series
 To add small cars including small MPVs as well as light vans
Dongfeng Yulon Motor Co., Ltd. ▽Luxgen (Taiwanese) brand
Note: Identified as a Chinese brand.
Dongfeng Motor Commercial Vehicle Co.,Ltd.
(Parent organization of a potentially newly established firm "Dongfeng Volvo Truck")
▽Dongfeng brand
* New vehicles adopting the technologies of AB Volvo/UD Trucks will also be added under this proprietary brand
(reference)
Soueast Motor Industry Group Co., Ltd.
▽Soueast brand
Note: Dongfeng Motor Corporation plans to reorganize and acquire the Fujian Motor Industry Group as its wholly-owned subsidiary on the condition that the unit sales of Soueast Motor exceed 300,000 units (including engines). Prior to the acquisition, the Dongfeng Motor Corporation will hold a 45% stake in the Fujian Motor.
JV brand Dongfeng Nissan Passenger Vehicle Company ▽Venucia brand
* R50X (Launched in November 2013)
* Chenfeng e30 (an EV, expected to be launched in 2014)
* The brand plans to release several new models in future.
Note: The date of sale of the "Venucia" brand EV (Chenfeng e30) is expected to be moved up by one year from the initially scheduled 2015 to 2014.
Dongfeng-Peugeot-Citroen Automobile Co.,Ltd. ▽JV brands
(Yet to be released. "Dongfeng-Peugeot-Citroen" is a potent candidate brand name with the "Dongfeng" logo likely to be adopted.)
* In 2014, the first model of the JV brand (using the same "Platform 2" as the Peugeot 408) will be launched.
* 2015: A JV model using the same Platform 3 as the Citroen C5.* 2015-2016: A model based on the Citroen C6 (a high-end passenger car "Dongfeng No.1" (tentative name) placed as the competitor to the "Red Flag H7")
* Around 2016: A model using a platform which is co-developed by PSA and Dongfeng Motor Group Co., Ltd.
 It is also expected to be produced and sold as a high-end model of the Fengshen.
Dongfeng Honda Automobile Co., Ltd. ▽JV brand (Yet to be announced)
* The first model "Ciimo" (based on the eighth-generation Civic) was launched, whose brand name is yet to be announced.
Dongfeng-Yueda-Kia Motors Co., Ltd. ▽Horki brand
* 2015: The first production model (most likely to be an EV) of the "Horki" JV brand started production (the concept car based on the new Cerato has been disclosed in April 2013)
Dongfeng Renault Automobile Co., Ltd. (plan) ▽JV brand (yet to be announced)

 

▽Model plan of the "Dongfeng" proprietary brand light vehicles: "Soueast" brand expected to be added in future
 In 2013, Dongfeng Motor Corporation announced the group's future business policy on the main lineup of "Dongfeng" (DF) proprietary brand light vehicles over five to 10 years from now on. The automaker plans to build the brands with reference to the product lineups of GM. More specifically, the "Fengshen" series of Dongfeng Passenger Car will be built with reference to the GM's "Buick" brand series, the "Futurn" series of Dongfeng Liuzhou Motor with reference to the "Chevrolet" series, and the "Fengdu" series of Zhengzhou Nissan with reference to the "GMC" series.
 The brands will be further positioned in their respective model segments. The "Fengshen" series of Dongfeng brand will be positioned as high-end vehicles, the "Futurn" series as family type vehicles, and the "Fengdu" series as special-purpose vehicles. (The model segments of the three series of the Dongfeng brand had been conventionally defined as family type, chiefly MPV, and light commercial vehicles (LCV), respectively).
 The lineup plans of the three series by segment are as shown below:
 (1)"Fengshen" series: Crossover will be added to the main segment, namely, sedan and hatchback.
 (2) "Futurn" series: Chiefly MPV.
 (3) "Fengdu" series: The lineup will be built focusing on the multi-purpose Crossover including pickup vehicles.
 Dongfeng Motor Corporation plans to launch a private-sector version of the military off-road vehicle "Mengshi" as a high-end SUV under the Dongfeng proprietary brand.
 Dongfeng Motor Corporation currently holds a 45% stake of Fujian Motor and will make it a wholly-owned subsidiary. Along with the acquisition, Dongfeng Motor Corporation expects to incorporate the "Soueast" brand business which is currently under the Fujian brand, into the Dongfeng's proprietary brands.

 

Latest trends of "Dongfeng" proprietary brand bus business
 With regard to the bus business of the group, Dongfeng Motor Corporation announced in November 2013 its policy of intensively promoting special-purpose buses and new energy buses (Source: An article in the group paper "Dongfeng Motor Report").
 Dongfeng Motor Corporation showed its own recognition that the immediate issues of its bus business lie in the production (manufacturing) process and the sales policy. The company will  integrate businesses through the establishment of collaborative networks, the improvement of bus businesses, and exploration of business opportunities. The automaker intends to deliberately implement the mid-bus, large bus, and high-grade bus (sightseeing bus etc.) businesses in accordance with the trends of the bus industry.

 

Export of proprietary and JV brand vehicles of the group: Total sales of passenger cars and commercial vehicles combined at 300,000 units targeted for 2016

 Dongfeng Motor Corporation has set the goal of entering one of the top three positions among Chinese makers in the field of the group's proprietary and JV brand vehicle exports by 2016. The company aims to achieve exports of 300,000 units, which is equivalent to 10% of the group's sales targetl for proprietary and JV brand vehicles (3 million units). (Announced in April 2012)

 Dongfeng Motor Corporation announced in July 2013 that it plans to build 10 overseas regional strategic markets including Russia, Iran, Brazil as its overseas business. Dongfeng Motor Corporation indicated a policy of providing local after-sales service and technical support not through an agent but by itself in the above-mentioned strategic markets. The automaker newly established regional sales companies in Russia ,Iran, Brazil. It also announced that it would construct CKD assembly plants in Brazil and Iran.

 The cumulative expors from January to October 2013 for the group's proprietary brand passenger cars were 5,940 units in total. In terms of the breakdown, Dongfeng Liuzhou Motor sold 74 units of "Futurn" series, Dongfeng Yu'an Automobile sold 4,151 units of "Dongfeng Xiaokang" (mini vans), Dongfeng Passenger Car sold 1,122 units of "Fengshen" (the S30/H30/A60), Dongfeng Automobie Co., Ltd. sold 185 units of Junfeng CV03 in total, and Zhengzhou Nissan sold 408 units of the Fengdu series (the Yumsun/Succe/Oting).

 

 



Production Forecast by LMC Automotive: Dongfeng production to rise to 1.18 million units in 2016

(LMC Automotive、November 2013)

 According to LMC Automotive's forecast in November 2013, production of Dongfeng's own brand (the Dongfeng and Luxgen) and its joint ventures' brands in 2013 will increase by 8.7% to 879,000 units from the previous year. The Chinese OEM started its joint ventures brand Venucia and DF Honda with Nissan and Honda respectively form 2012. The new brands contribute to Dongfeng's growth in 2013. The Chinese maker's production is expected to reach 1 million units by 2015 and will continue expanding up to 1.18 million units by 2016, which is a 46% increase from 2012.

Dongfeng's light vehicle production forecast of own brand and JV brand's by country and by make

(Units)
COUNTRY GLOBAL MAKE 2010 2011 2012 2013 2014 2015 2016
Total 670,296 739,067 808,689 878,507 970,647 1,089,946 1,181,850
China DF Honda 0 0 14,160 15,665 15,983 17,322 18,128
Horki
(former "Dianyue")
0 0 0 0 0 3,240 3,937
Dongfeng 670,201 739,065 746,869 763,834 844,648 950,004 1,033,339
Venucia 0 0 45,141 96,923 107,368 116,549 123,628
Sub-Total 670,201 739,065 806,170 876,422 967,999 1,087,115 1,179,032
Thailand Dongfeng 0 0 2,483 2,085 2,648 2,831 2,818
Malaysia Dongfeng 95 2 36 0 0 0 0
Source: LMC Automotive "Global Automotive Production Forecast (November 2013)
(Note) 1. Data indicate figures of only small-size vehicles, including passenger cars and light commercial vehicles with a gross vehicle weight of under 6 tons.
2. All rights reserved. Reproduction of any data will require permission of LMC Automotive.
3. For more detailed information or inquiries of forecast data, please contact LMC Automotive.

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