Geely to be the strategic partner for Proton?
Hong Kong-listed mainland car maker Geely Automobile Holdings Ltd yesterday signed a partnership agreement to assemble its own brand cars in Malaysia.
According to Geely Vice President Zhao Jie, production of Geely cars in the countries of Southeast Asia will begin next March in a factory owned by Malaysian manufacturers Information Gateway Corporation Sdn Bhd IGC.
The company employs about 500 Malaysian workers, the factory will turn 30,000 Geely brand cars next year with components supplied by China, said Zhao.
The first Geely car to be produced in Malaysia will be June 1 liter Freedom Cruiser, the latest model launched last month the company, he said.
Two new models, larger than the Freedom Cruiser, will be introduced at the Malaysian plant later, Zhao said.
Geely, 60 68 percent owned by Li Shufu - one of the richest people of the continent - will be the third Chinese automaker to produce cars abroad.
Chery Cars, controlled by the local government in Wuhu, East China's Anhui Province, began producing cars in Iran at the end of last year.
Chery is also in talks with automakers Malaysia winged to produce cars there.
Brilliance China Automobile, another Hong Kong-listed automaker based on the mainland, has signed an agreement with an Egyptian partner last month to produce cars in the countries of North Africa.
Egyptian production of its brand Zhonghua sedan will begin in late August
Besides the production of cars in Malaysia, Zhao Geely said the company also exported 10,000 cars in the country by the year next IGC.
This year, Geely hopes to export 3,000 Haoqing compact cars in Malaysia, he added.
The plant in Malaysia will be the manufacturing base Geely for Southeast Asia, which will target the whole market in the region, said Zhao.
Malaysia is one of the 10 member countries of the Association of South-ASEAN Asia which have signed an agreement to reduce tariffs on auto exports to another.
Tariffs on imported vehicles from ASEAN members have been reduced to 20 percent early this year to 190 percent in the past.
the Chinese made cars will have good prospects in South Asia, especially when China reached a free trade agreement with ASEAN, said Liang Yangchun, an industry analyst with the development of the State Council and research Center.
China is negotiating with ASEAN to sign an agreement with all of free trade in 2010.
But Chinese automakers will not be able to play at the end of the automobile market economy of South Asia as many international auto giants such as Toyota, already have a strong presence there, Liang said China Daily.
To go abroad is a good way for some Chinese automakers to expand their business as they face growing competition from global auto giants in the domestic market slow down, he added.
All have formed the major automobile manufacturers in the world of joint ventures in China.
China Car applications increase by 15 percent to 2 6 million units this year, the China Association of Automobile Manufacturers predicts.
The growth figures are the same as in 2004 but down from over 70 percent in 2003.
Zhao said Geely aims to double its total car exports this year to 10,000 units.
During the first four months of this year Geely exported more than 3,000 cars.
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