China auto industry focus on homegrown brand

The explosion of homegrown brands in the Chinese auto industry in the five years since the country entered the World Trade Organization has made a mockery of worries expressed in 2001 that international competition would harm the fledgling local auto industry when the country cut customs duties and opened up its domestic market.

On Beijing Inte'l Auto Show, according to the organizers, homegrown brands account for one third of the 572 vehicles on display, the biggest share in the history of the biennial event.

Zhu Yanfeng, FAW general manager, said his company will sell two million vehicles in 2010, half of which will be homegrown brands, worth a total of 200 billio n yuan (25 billion U.S. dollars).

The state-owned auto giant plans to transform itself from a loss-making enterprise into a competitive one, with priority given to developing homegrown brands and earning profit, said Zhu.

An advanced automotive engineering center will be built to facilitate the development of homegrown brands. Asked whether domestic automakers can compete with multinational giants, some domestic manufacturers said that "we often underestimate ourselves, while foreign counterparts have a clearer view".

Homegrown brands are "a beautiful butterfly that is struggling free of its ugly chrysalid", said Chen Guangzu, an expert with the China Automotive Industry Consultative Committee.

The year 2006 saw Chinese homegrown brands reach a new level of sophistication -- besides improving product quality and exterior design, they are now developing their own engines.

Chinese automakers have the bit between their teeth and will become rivals of their counterparts in the United States, Japan and Germany in the near future, said analysts, quoted by the Shanghai Securities News.

A roadways plan devised by the Ministry of Communications will more than double the existing expressway network, bringing it to 85,000 kilometers within 30 years. The roads are needed to accommodate the growing number of auto vehicles and to support economic growth.

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