Chinese automakers expand global reach

CHANGCHUN -- Some Chinese auto brands have witnessed rapid global market expansion during the first half of this year, despite a weak global economy and sluggish domestic sales.

During an ongoing auto expo in the city of Changchun in Northeast China's Jilin province, Huang Haitao, deputy general manager of sales at the Geely Group, a major Chinese automaker, said the company is ready to expand its European market.

Huang said Geely's exports during the first half were double those of the same period last year, adding that the company exported more than 6,500 cars in May and over 10,000 units in June.

Statistics released by the China Association of Automobile Manufacturers showed that China exported 487,900 cars during the first half, up by 28 percent year-on-year.

In the Russian market, the Chongqing-based LIFAN Group sold 4,545 cars during the first quarter, up by 69 percent from the same period last year; Chery Automobile's exports during the period were 2.5 times that of last year and Geely's exports were 3.65 times, according to the Association of European Business.

Xing Wenlin, vice president of Great Wall Motor, said his company has been exporting cars to multiple countries, including Russia, Australia Italy, and Chile.

GWM's exports to Russia hit 20,000 units last year, about 25 percent of the company's total exports. The company exported 9,000 units to Russia during the first five months of the year, a growth of 32 percent year on year.

Russia has long been an important part of GWM's overseas strategy. GWM's assembly plant in Russia was put into operation in 2006, making the company the first Chinese auto brand to set up a plant in the country.

The company opened an assembly plant in Bulgaria in February and it aims to further expand its European market with the help of the plant.

Despite a growing share in the global market, Chinese automakers still face grave challenges in going global, experts warned.

Many industrial insiders said at the auto show that the appreciation of China's currency and the rising cost of labor and materials have dulled the competitive edge of Chinese auto brands.

Additionally, Chinese companies are plagued by a lack of a clear overseas development strategy, an advanced operational philosophy and the ability to conduct significant research and development.

Sun Zhiming, head of the economic institute under the Jilin Academy of Social Sciences, said Chinese companies are in an urgent need of industrial upgrading and higher quality service.

"We will better serve foreign customers' needs and expand our presence in the global market by improving our service quality," Huang said.