China auto news

Report: China's Youngman bails on Saab, Mahindra still in the mix

Zhejiang Youngman Lotus Automobile has been jettisoned from the dwindling pool of bidders for Saab after tendering an offer of $492 million for the whole kaboodle. Exact reasons weren't given for Youngman leaving the table, but according to a report in Autoweek.nl, "Chinese bureaucracy" was partially to blame and there apparently wasn't complete confidence in the Chinese company's finances.

Reports say the bidding is meant to close in the next week, but we still don't know who all the bidders are - India's Mahindra & Mahindra, China's Geely/Volvo and at least one as-yet-unknown entity are after the whole company or select assets. Swedish media was hinting at another bidder with electric car knowledge, not from China, to take control of Saab. And if that same Autoweek.nl story is correct, Spyker's Victor Muller didn't leave the premises empty-handed, as "Spyker would be the licensing agent of the Saab 9-5 and continue to be paid for its use."

Report: Chinese-market Land Rover Freelander and Range Rover Evoque to use Chery engines?

A couple of developments on the recent Jaguar/Land Rover joint venture are being reported in Chinese media based on a report in China's Economic Daily News. The 130,000-capacity factory planned for Jiangsu is epected to mint its first vehicle in 2014, with numbers given for the breakdown so far as: 43,000 Land Rover Freelander 2s, 34,000 Range Rover Evoque models (called the Aurora in China) and, according to Google Translate, "the joint venture brand vehicles of 23,000 Jaguar sedan."

We're not sure if that really means 23,000 Jags will be made, since that would be a six-fold multiplier of Jaguar's 2011 sales in China. The quoted Land Rover production would only be doubling its sales tally from 2011, even though the brand's sales were up 105 percent in Q1 of this year. There will be a separate joint-venture brand created between JLR and Chery as well, so that could be a part of it. Futher on, the plan is for the plant to expand to a capacity of 250,000 units.

More interestingly, the locally-made engines will be JLR's 3.0-liter V6 alongside two Chery motors, a 1.6-liter TGDI turbo and a 2.0-liter TGDI, with plans to "gradually introduce" the Chery engines into the Land Rovers. JLR engineers are said to be moving to China to continue joint development of the TGDI motors, which has apparently been ongoing. Until those are ready, JLR will import its 240-horsepower, 2.0-liter motor.

The report in China's 163.com is also interesting for the regulatory and business context it provides on the joint venture, with government rules mandating the minimum amount of investment and the establishment of R&D centers. The tie-up is said to be a boon to Chery's fortunes in light of the assertion that Chery's "operating conditions are not ideal" and that getting the "core technology" for its own brands had "become the top priority of the project approval." Official approval of the JV is expected later this year.

Report: Shanghai GMC dealer offering five tons of free gas with truck purchase

Big trucks just aren't appealing enough on their own, at least in some places. For proof, look to a Shanghai GMC dealer who is offering about three years worth of free gas to anyone who buys a new Sierra Denali. Too bad it'll take about 20 years to pay off the big truck.

The dealer is giving away five tons - about 2,000 gallons, worth around $8,000 in China - of petrol to new Sierra Denali buyers in China's largest city, according to The Detroit Bureau. The offer appears to be a nod to rising China gas prices, which are climbing towards levels similar to those in the U.S. now that the Chinese government is doing less to artificially keep gas prices down. Full-size trucks have been sold in China for about three years and are known to be status symbols in China, says The Detroit Bureau.

There is, of course, a catch. The Denali, unlike most General Motors vehicles sold in China, is built in the U.S., so the price tag is about $134,000, or almost three times what the model sells for in the States. Here's hoping a few free car washes come with those full tanks.

Report: Chinese demand could prompt Aston Martin to press on with Lagonda revival

Automakers are usually pretty decisive. They either build a car or they don't. But Aston Martin has embarked down a bumpier road with Lagonda.

Aston bought the Lagonda marque way back in 1947, but after operating it as a separate brand for a few years, it let the brand peter out in the 1950s and 60s. The moniker was revived as a nameplate on a handful of Aston Martin sedans beginning in the 1970s, but that was pretty much the last we saw of it until the 2009 Geneva Motor Show.

That's when the British automaker unveiled the rather unusual concept vehicle (pictured above) to revive the Lagonda name once again as a separate brand. It was meant to test the waters, and the response was not favorable. So it had appeared that AML was dropping the L from its initials and the entire project along with it. But as a stand-alone niche automaker looking to stay afloat in a rapidly amalgamating industry, Aston needs to produce more than front-engined, rear-drive, two-door GTs. And the Rapide sedan apparently isn't going to be enough, so it looks as if that the Lagonda project could be back on the table.

According to Autocar, the real impetus, however, could be coming from emerging markets in Asia - particularly China, but also the Middle East and Russia. The timing for a high-end luxury crossover built by a company known for its exotic sports cars, however, could prove to be good timing or poor: Maserati, Lamborghini and Bentley are all entering the segment in the coming years, so if Aston wants to get a slice of that lucrative pie pioneered by Porsche, it had better get those wheels in motion.

Video: China chastizes Beijing Motor Show over scantily clad models

Our post on China's "Tiger mom" phenomenon was illustrated with that above picture; it's the Jeep Wrangler Dragon Design Concept at the 2012 Beijing Motor Show, accompanied by a booth professional. The model - her, not the Jeep - made a fair few friends in the Autoblog Comments section, but it turns out she and her kind attracted the ire of the Chinese authorities.

The Capital Ethics Development Office gave the Beijing show organizers a caning because the "scantily clad" models had "a negative social impact," and the show was warned not to let "such vulgar publicity" occur again. There's a lot of room between that leather bustier and a burqa, however, so all's not lost for next year's show in Shanghai.

Scroll down to watch the Bloomberg video on the matter.

Continue reading China chastizes Beijing Motor Show over scantily clad models

Report: Volvo XC90 to become Geely

Volvo recently unveiled yet another model year of the impossibly old XC90 - promised to be the final one before a complete redesign. But the overripe vintage of the first SUV to fall from Volvo's vine isn't stopping corporate parent Geely from absconding with the platform to launch a new high-end brand for China.

According to China Car Times, Volvo's new XC90 will be launching in 2014, and after that the original will soldier on in China, at least in some form. The report does not make clear whether the first-generation XC90 will merely be re-badged, or if the platform will be used for a new Geely design.

Geely launched its first SUV, the GX7, at this year's Beijing Auto Show, according to the report.

Report: Chery requests Chinese approval of $1.9B joint venture with Jaguar Land Rover

A month ago, Jaguar Land Rover signed a joint-venture agreement with China's Chery Automobile Company. JLR's 12.1 billion yuan ($1.9 billion U.S.) investment, if approved, will pay for a plant in Changsu to build Jaguars, Land Rovers, engines and joint-venture models. The facility will also house a research and development center. Chery has submitted the paperwork to clear the deal with the Chinese government. The agreement must pass muster with the Ministry of Enviroment Protection, after which it will go to the National Development and Reform Commission.

When the agreement was first inked an Indian analyst said, "it will be some time before we see the results," a nod to the fact that government approvals can take a long time. Subaru is an instructive example, having signed an agreement with Chery a year ago. Sources said the deal was ready to be approved last November, but that was the last that has been heard of it - it's still waiting on the necessary signatures.

But JLR has the long view in mind: it sold 38,890 vehicles in China last year - all imported - a figure representing double-digit sales gains for both brands. The proposed factory will have a capacity of 130,000 units, providing a healthy buffer in case the bureaucracy sits on things.

Report: Ford finally takes serious aim at the Chinese market

When we asked Volkswagen last year why it was building a factory in the U.S., after having missed the irrationally volcanic era of car sales, we were told that even a 12-million-per-annum market was still too big to ignore. A report in Reuters paints Ford's situation in China somewhat the same way: Ford is only now attacking the Chinese market, building plants and increasing local capacity there, after numerous other players have established their positions.

Nevertheless, there's still much to play for. Whereas our market is expected to hang around in the 12- to 15-million-unit range, China's market is predicted to hit 30 million cars per year by 2020. Said one analyst, "People are saying the Asia Pacific auto industry by 2020 is half the world's industry." A little piece of China's colossal market will, anywhere else, still be considered a pretty big piece of pie.

After years of false starts and missteps in The Middle Kingdom, Ford sells six cars in China now, but they weren't developed for the Chinese market and haven't taken off with buyers there. Over the next three years Ford intends to introduce 15 more cars, many of them SUVs, and 20 engines to the Chinese market that can make better impressions on the locals.

That won't put it anywhere close to market leaders General Motors - which already sells 35 cars there and is lining up 60 more models, and has the preeminient Buick brand - or Volkswagen. But even the 3.1 percent share that one analyst predicted was in Ford's reach by 2020, up from 2.8 percent now, will be enough to turn Ford's currently desultory Chinese-market profits into something like a $700-million spigot once its production and offerings are stabilized.

Ford is investing $600 million and $760 million in two projects with its JV partner Changan Ford Mazda Automobile to expand capacity to 1.5 million autos per year. At the moment, The Blue Oval has no plans to take Lincoln across the Pacific.

Report: Volvo planning long-wheelbase S60L for Chinese market

Regular readers should be plenty familiar with the trend in the Chinese market towards long-wheelbase versions of the luxury sedans we have here. It's just what high-end customers in the decentralizing economy look for. And European automakers have been only too glad to oblige.

BMW, Audi, Porsche and Infiniti have all recently stretched their existing luxury sedans to lure new buyers in the rapidly developing Chinese market, and now word has it that Volvo is following suit with a long-wheelbase version of the S60.

The Chinese-owned Swedish automaker already produces a stretched version of the S80 in China, but has reportedly found little success. The hope is that the S60 - which for all its positive attributes does not have a particularly spacious rear bench - will plug that gap better in long-wheelbase form.

Report: Saab union asks Obama to pressure GM for licensing deal

The door has not yet closed on Saab. Hoping for yet another 11th hour stay of execution, the defunct carmaker's chief union, IF Metall, has written directly to President Obama, asking him to intervene, according to Just-Auto. While on the surface, this may seem silly, it's actually rather clever, even if it has little likelihood of working.

With the United States government still owning 26 percent of General Motors, the Swedish union is hoping it can appeal to Obama to pressure General Motors into granting licenses to continue manufacturing Saab vehicles, according to the report. It's this sticking point that has torpedoed every attempt to forestall Saab's dissolution, as GM fears that were it to allow continued production of Saabs developed under GM's ownership, it would open up the possibility of intellectual property conflicts, particularly if a Chinese manufacturer that competes with GM's own Chinese partner, SAIC, acquires Saab.

You have to admire Saab loyalists, as they clearly have not given up hope. But in this case, they just don't have any other options: Unemployment in the Saab hometown of Trollhättan has hit 40 percent, according to the report.