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More Chinese brands in the offing for Australia

Busy market: JAC (A0-class hatch pictured) is just one of about 200 automotive brands in China.

Importers sifting through 150 Chinese vehicle makers to find the next big thing

22 Nov 2010

CHINESE vehicle importer White Motor Corporation is looking to expand its stable of brands beyond Higer and JAC (Jianghuai Automobile Company) for Australia.

WMC general manager Shannon Taylor visited another Chinese motor vehicle manufacturer late last week to sound out its potential as a source of vehicles for Australia.

But Mr Taylor said there will be a limit to the number of Chinese companies capable of servicing a market such as Australia, with its high standards of quality, safety and technological sophistication.

 center imageFrom top: WMC general manager Shannon Taylor, Geely MK, Chery J1, Great Wall C30.

Rival importers Ateco Automotive and Chinese Automotive Distributors are also known to be in various stages of expanding their own stables of Chinese brands.

So far, about six Chinese brands are either locked-in for Australia or in the final stages of contract approval, with up to three more likely.

Ateco is already importing Great Wall vehicles and is set to launch the Chery vehicle line-up early in 2011, while CAD – owned by Perth multi-franchised car dealer and businessman John Hughes – has Geely on track for a 2011 launch.

In October, Mr Hughes told GoAuto he was poised to sign a second Chinese brand – a maker of pick-ups and SUVs – for Australian distribution.

Ateco also is believed to be talking with other Chinese car companies and one of these is believed to be JAC for its line of light vehicles, including passenger cars, SUVs, vans and utes.

However, WMC already has the JAC truck distribution agreement signed and sealed for a 2011 sales kick-off, and also wants the light vehicle side of the business.

Mr Taylor said China had a huge number of vehicle manufacturers, many of which were making contact with Australian distributors with a view to exporting to this market.

But he said only a few Chinese companies had the resources, products and quality standards to entice an Australian importer to get into bed with them.

“We are always on the look-out for new opportunities, and we would be silly not to at least go and have a look at the potential of these other companies,” he said in China, where WMC was showing off its new JAC truck range and expanded Higer line-up that is set to include a Toyota HiAce van competitor and, potentially, a pick-up, from late next year.

According to JAC executives, China has about 200 automotive brands, including almost every known western car and truck make, plus a further 150 Chinese brands.

They said the top 10 companies accounted for 70 per cent of Chinese sales, which this year are expected to top 17 million – up from 13.7 million in 2009.

But Mr Taylor, a former Nissan UD and Subaru executive, said that, while the array of car, bus and truck makers in China was huge, only a few “super companies” could deliver all the export requirements for western markets such as Australia.

He said Higer – the world’s third-largest bus-maker with an annual volume greater than Volvo, Scania and MAN combined – was one such company, while JAC – China’s largest light truck maker and exporter – was another.

Both of these companies are government-controlled – Higer is part-owned by the Chinese government, while JAC is 33 per cent controlled by the communist government of the Anhui province - putting them among the elite manufacturing companies with plenty of support from Beijing.

Both Higer and JAC have been given ‘export quality exemption’ from the Chinese government, having proved they could achieve export quality without constant checks from quality-control bureaucrats.

While JAC is best known for its trucks, it has been expanding its light vehicle range over the past eight years, starting with a people-mover and now including eight models covering sedans, hatches, SUVs and pick-ups.

Although JAC claims to have a production capacity of 730,000 units, its sales this year in both domestic and exports markets will be about 470,000 – sufficient to make it a top 10 vehicle-maker in China.

Higer expects to turn out about 20,000 buses and coaches this year, exporting to about 40 markets, including Australia and New Zealand.

Production volumes are expected to rise dramatically over the next few years with the introduction of light-duty commercial vehicles, foreshadowed by four prototypes – three vans and a pick-up – revealed to Australian journalists at its home base in Suzhou, north of Shanghai.

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