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More Cars to Roll out from Sino-French Venture: Report
The Dongfeng-Citroen Automobile Company Ltd is to expand its annual car production capacity to 300,000 units by 2007 or 2008.
It sold 43,000 units in the first 10 months of this year, an increase of more than 23 per cent over the same period of last year, according to report by chinadaily.com.cn.
The company, which has its headquarters in Wuhan, the capital of Central China's Hubei Province, is the largest Sino-French joint venture in China, with a total investment of 13.11 billion yuan (US$1.58 billion).
Dongfeng-Citroen is committed to providing Chinese families with high-quality and affordable cars, said the company's General Manager Zhang Shiduan.
"Our annual production and sales are expected to reach 150,000 units by 2003 or 2004,'' Zhang said.
Industrial analysts predict that economy cars like Dongfeng-Citroen's Fukang model have a tremendous market potential in the next 10 years as the government has decided to speed up car production during the 10th Five-Year Plan period (2001-05).
The joint venture now produces Fukang cars with 1.3-to-1.6-litre engines, cars which are popular with both Chinese families and taxi companies.
The firm's first-stage projection plan of producing 150,000 cars per year was recently accepted by the central government, signalling the full establishment of another large car manufacturing base in China.
The country's other two largest car manufacturing bases are in Shanghai, China's largest economic powerhouse, and Changchun in Jilin Province, the cradle of China's automobile industry.
The completion of the first stage of Dongfeng-Citroen's project, which started in 1993, laid a sound foundation for the car industry to adjust its product mix and deal with challenges posed by the country's pending entry into the World Trade Organization (WTO), said Zhang Guobao, vice-minister with the State Development Planning Commission.
The joint venture's parent company, the Dongfeng Motor Corp, focuses on truck production.
Domestic carmakers are feeling pressure from the imminent accession to the WTO.
French automaker Citroen, which has a 25 per cent in Dongfeng-Citroen, will launch its family travel model Picasso within the joint venture by the end of this year in order to meet the increasing and changing demands of Chinese consumers.
According to Zhang Shiduan, Dongfeng-Citroen now has more than a 9 per cent share of the domestic car market, from less than 2 per cent in 1996.
The Fukang model's main rivals are Santana and Jetta cars produced by Shanghai Volkswagen and FAW (First Automotive Works) Volkswagen.
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