China Watch : SAIC to start MG6 production in the UK

Automotive News China, 28th May, 2010

SHANGHAI – SAIC Motor Corp. says it will start producing MG6 sedans at its British plant by the end of this year and will start selling the models in the first quarter of 2011.

The company also plans to build and sell a right-hand drive version of its newly unveiled Roewe 350 in England, although SAIC has not revealed its timetable for this model. The Roewe 350 currently is produced at SAIC’s Pukou plant in Nanjing.

Company President Chen Hong spelled out his plans for SAIC’s in-house brands during a Tuesday briefing in Shanghai.

SAIC acquired MG Rover’s 10,000-unit-a-year Longbridge plant in Birmingham after a merger with its much smaller peer, Nanjing Automobile Group, in 2007.

In turn, Nanjing had acquired MG Rover in 2005 after Rover collapsed through financial difficulties. 

SAIC used technology acquired from MG Rover to launch its first self-developed car, the Roewe 750, in 2007. SAIC followed with the Roewe 550 and MG6 models, which are popular with young, elite Chinese professionals.

Last year, SAIC’s in-house brands generated sales of 90,000 units in China, including both the Roewe- and MG-branded models. In 2010, the company expects its own brands’ sales will double.

Big growth in China

On Tuesday, SAIC President Chen Hong said his company expects to sell more than 1.6 million automobiles in China in the first six months of 2010, up 30 percent from a year earlier.

Those sales figures include vehicles marketed by the company’s joint ventures with General Motors Co. and Volkswagen AG.

While strong, such growth would be significantly slower than SAIC’s recent sales pace.  In the first four months of 2010, SAIC and its joint ventures sold 1.2 million units, up 55 percent from a year earlier.

“This year, as we expected, China’s auto sales growth will be strong at the beginning but slow down gradually,” Chen said. “In the fourth quarter, there will probably be negative growth. But overall, auto sales in 2010 will definitely see double-digit growth.”

Chen said he was confident that SAIC would achieve its target of selling 3 million vehicles this year.

China’s overall vehicle sales grew 60.5 percent in the first four months from a year earlier, but that pace is expected to taper off due to sales fluctuations in the year-earlier period. Sales exploded in 2009 after the Government introduced generous sales incentives.

Chen also told a Shareholders’ Meeting that SAIC supported GM’s move to raise its stake in their Wuling joint venture, which produces low-priced minibuses and pickups. Negotiations were proceeding smoothly, Chen said.

SAIC-GM-Wuling is a three-way venture among GM, SAIC and Guangxi-based Liuzhou Wuling.

[Source: Automotive News China]

Clive Goldthorp

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