Home / FLD / Joint venture car manufacturers in China initiate capacity expansion

Joint venture car manufacturers in China initiate capacity expansion

As China gears up and hastens its bid to become the world’s largest automobile market, many foreign car makersare increasing their investments in the country though local joint ventures, with the goal of getting a bigger chunk of market share through capacity expansion. Analysts predict that the competition will increasingly become fiercer. Shanghai Volkswagen, a joint venture between the country’s leading automaker SAIC Motor and its German counterpart Volkswagen, sold more than 1.17 million vehicles in 2011, a 16.42% increase year-on-year. The joint venture is also negotiating for a plant in western China. In south China, meanwhile, FAW-Volkswagen, a joint venture of FAW Group Corp., Volkswagen AG, Audi AG and Volkswagen Automobile Investment Co. Ltd., will be setting up its first integrated manufacturing base in Foshan. The Foshan plant will require a total investment of 13.3 billion yuan (US$2.1 billion), and is scheduled to begin production in August 2013, with a production capacity of 300,000 units in the first phase. Dongfeng Nissan , a joint venture between Dongfeng Motor Co. and Nissan Motor Co. opened its second plant in Huadu, Guangzhou, last December 21, 2011. Together with the first plant also in Huadu, the two plants will be Nissan’s largest production base in its global production network, with a capacity of 600,000 units per annum. Not to be outdone, BMW Brilliance Auto, the joint venture between Brilliance China Automotive Holdings (CBA) and BMW, the German luxury carmaker, will begin operations in its new factory in Shenyang, Liaoning Province, early this year. Last year, Shanghai General Motors Company Ltd., a joint venture between Shanghai Automotive Industry Corp. and General Motors Co., began the third-phase construction of its auto manufacturing base in Shenyang last September 2011. When operational, the new plant will have an annual output of 300,000 vehicles. (January 27, 2012)