Dongfeng, Changan may bid for Volvo in Apr

Shanghai, February 27 (Gasgoo.com) Three interested companies may place indicative bids for Ford's up-for-sale Swedish brand Volvo Cars in April, according to Swedish newspaper Dagens Industri (DI).

Reuters noted that DI quoted unnamed sources as saying that the three bidders include Chinese carmakers Dongfeng Motor Group and Chongqing Changan Automobile Co, and "a European constellation".

"Indicative bids are to be expected around the Easter weekend," the paper said. The expected purchase price for Volvo is believed to range between SEK20bn ($2.29bn) and SEK25bn ($2.86bn), it reported.



The paper also said the European Investment Bank (EIB) was expected to grant Volvo a 5 billion Swedish crowns ($568 million) loan in the near future. Volvo applied for the loan last month.

Volvo Cars is a separate company from Gothenburg, Sweden-based Volvo AB, the world's second-largest truck maker. Dongfeng Motor Corp is China's third-biggest automaker while Changan Auto Group manufactures Volvo cars in China in a partnership with Ford.

VW China to launch four new models every year

Volkswagen Group in China, a joint venture between Volkswagen AG of Germany and Shangai Auto of China, plans to add or revamp four models each year in a bid to double sales and maintain its leading position in China's automobile industry.

"We plan to add or renew at least four models per year and double the number of dealerships to achieve our sales targets and increase our market share," Winfried Vahland, executive vice president of the Volkswagen Group, and president and CEO of Volkswagen Group China, said.

He said the company would strive to combine Volkswagen's cutting-edge and environment-friendly technologies with local R&D capabilities to generate products that perfectly meet customers' needs.

It would also improve customer satisfaction and brand image through enhanced dealer networks and upgraded service, he said.

Shanghai Volkswagen and FAW-Volkswagen as two powerful joint ventures will further cultivate synergies and win-win partnerships to achieve even greater success and move Volkswagen Group China forward, he said.

Volkswagen Group China, he said, is committed to the Chinese consumers, its employees, shareholders, partners and the long-term sustainable development of the Chinese automobile industry.

"The current global economy and automobile markets now face many uncertain factors. However, we recognise that the slowdown presents challenges. We have defined a plan to face these challenges and take all opportunities," Vahland said.

"Over the next two years, we will remain flexible, preparing for several scenarios of the China's total market development. We will continue to invest in building our brand images, customer satisfaction, products and corporate social responsibility and never compromise on quality," he added.

Jilin plans to produce 1 mln vehicles in '09

Shanghai, February 26 (Gasgoo.com) Northeastern China's Jilin province, home to Chinese auto giant FAW Group, has announced a series of auto industry goals for this year, including its plans to produce 1 million vehicles, to achieve auto sales revenue of 240 billion yuan ($35.1 billion) and total profits of 14 billion yuan, xinhuanet.com reported today.

In its effort to reach the target of making 1 million vehicles in 2009, Jilin province will issue favorable policies to support the development of FAW Group, said the auto industry office of the province. Some policies will work together with the auto industry restructuring plans recently released the central government, which would encourage auto giants SAIC and FAW to expand through mergers.

In addition, Jilin province will take measures to boost vehicle output and sales this year by speeding up the development of 100 major auto-related companies and 100 major auto projects. More than half of the 100 auto and auto-parts projects are expected to start operation and deliver products to the market this year.


The list of its auto development projects in 2009 shows that this year Jilin province will promote the production of the Corolla sedan model at newly built Changchun FAW Fengyue Auto Co., the upgrades of FAW-VW joint venture's first factory, the expansion of FAW Car Co.'s Besturn sedan series, the production of FAW Jilin Car Co.'s small cars and mini-cars.

Jilin province will also support auto-parts projects, such as FAW VW's EA111 engine, Qiming auto electronics, Dongguang clutch and brake assembly, Xuyang sedan chair assembly.

Auto industry is the mainstay industry of Jilin province. Its capital city Changchun now has about 320 auto and auto-parts manufacturers. With an annual output capacity of 1.8 million units scheduled for the next five years, Jilin province will possibly become China's largest auto production base by 2014.

Shanghai VW to launch Tiguan SUV in late '09

Shanghai, February 26 (Gasgoo.com) Shanghai VW is set to launch the Volkswagen SUV Tiguan model as one of its flagship models this year. The China-made Tiguan model is expected to go on sale in late 2009, said Information Times today.

AS Volkswagen's first compact crossover SUV in the real sense, the Tiguan model was introduced to Shanghai VW, one of the German auto giant's Chinese ventures, for local production in China. But its launch was delayed last year due to low sales prediction. The Tiguan SUV is now eagerly anticipated by Chinese buyers and will hit the China market as the first VW SUV here.


The production Tiguan was released at the 2007 Frankfurt Motor Show and made its China debut at the 2008 Beijing auto show. It is the German carmaker's second compact SUV after Touareg to blend the crossover pleasures in the city and country driving. Its name is a hybrid from Tiger and Iguana, an exotic mix of boldness and wildness.

The China-made Tiguan SUV will come with the 1.4TSI, 1.8TSI and 2.0TSI versions, not much different from the imported Tiguan editions. It is based on the fifth-generation Golf's PQ35 platform. Its Chinese name and price are not decided yet, though at the 2008 Beijing auto show it was called "Tuhuan" ("journey happy") and rumored to sell for 500,000 yuan (73,200).

Shanghai VW launched the China-tailored new Volkswagen Lavida to the Chinese market on June 25, 2008. The all-new Lavida model is the first A-Class sedan jointly developed by Chinese and German technicians. The joint venture also released its sedan model Skoda Fabia to market at the end of last year.

Changan Auto: no new reason for share jump

Chongqing Changan Automobile Co, a Chinese partner of Ford Motor, said on Friday that it knew of no undisclosed information that might be responsible for a leap in its share price.

The company's A shares soared 95 percent to 7.15 yuan between Feb. 16 and Tuesday, rising their 10 percent limit every day, after it announced a HK$909 million ($117 million) plan to buy back its own Hong Kong dollar-denominated B shares . The B shares jumped 80 percent to HK$3.03.

That prompted a two-day suspension of trade in the shares while the company investigated the abnormal movement. Trade was expected to resume on Friday.

Changan Auto said neither it nor its parent group had any undisclosed information that might have caused the jump, and that there had been no major change in its operations. It said it had not entered into important new negotiations or agreements.

It also noted that in late January, it had estimated net profit plunged between 50 and 100 percent in 2008, from 666.9 million yuan ($97.6 million) in the previous year, as growth in China's auto market slowed drastically.

The company announced on Feb. 15 that it would buy back up to 70 percent of its B shares, equivalent to 18.1 percent of its total share capital, at a maximum price of HK$3.68 per share. Previously, its A and B shares had been suspended for four months pending a major announcement.

Industry analysts said that in addition to the buy-back, Changan's shares had benefitted from news of government subsidies for rural residents who trade in high-emission vehicles, since the firm is a big domestic producer of light trucks and minivans.

The company, which runs a car venture with Ford and Mazda Motor and produces compact cars developed in-house, also stands to benefit from other state incentives, such as a 50 percent cut in the purchase tax on cars with engine sizes smaller than 1.6 litres.