More on MG in Thailand
Chinese giant gears up
SAIC Motor and partner CP Group see promising future in Asean for made-in-Thailand MG cars and Maxus vans.
Published: 7/04/2014 at 03:04 AM
Newspaper section: Asia focus
SAIC Motor, one of China’s leading automakers, is preparing to make Thailand the hub for its Asean expansion as it looks to expand sales of the various brands under its banner into the region.
A worker assembles an MG 6 car at the highly automated SAIC Motor plant covering a 600-rai site near Pudong Shanghai airport.
“We are looking to use our partnership to expand into the region in the years ahead and want to use Thailand as the hub,” said Yu Jingmin, the head of overseas operations for SAIC.
The Fortune 500 company last year produced close to 5 million vehicles through its partnerships with the likes of General Motors, Volkswagen, apart from commercial vehicles such as Iveco, not to mention its own Roewe brand and MG, the iconic British sports car marquee it owns.
SAIC is looking to tap the rising demand for vehicles in Asean through its partnership with Thailand’s largest agricultural conglomerate, Charoen Pokphand Group. CP, which also has extensive industrial, retail and telecoms interests, has invested about 10 billion baht to start up a plant in Thailand is also on the lookout to expand in the years ahead.
“This is the global trend — manufacturing in China but having the quality of the West. Take the iPhone for example, where the product is made in China but quality is assured by Apple” — THANAKORN SERIBURI, Chairman, SAIC Motor-CP Co
“We have put 10 billion baht into the first phase of investment in Thailand and the plant is currently located in Rayong although we are talking about relocating to Amata,” said Thanakorn Seriburi, the chairman of the newly formed automotive division at CP Group.
CP is well known for producing Tiger brand motorcycles in China, but it has been gradually adapting its strategy to move away from the motorcycle business as the Beijing government has made it a policy to ban the use of motorcycles in many highly congested cities.
Few governments in the world would have the clout to issue such a sweeping edict, and the ban has caused a lot of controversy in China. Officially, the government has said that it wants to alleviate traffic congestion and pollution and reduce traffic accidents, adding for good measure that it believes motorcycles are the main vehicles used for criminal activities.
“Once I heard that reason, I told everyone who is thinking of producing motorcycles that they can dream on, and in fact they should stop thinking about it altogether,” said Mr Thanakorn, noting that motorbike sales in China have dropped to 8 million a year from 20 million a few years earlier.
Mr Thanakorn, who is also the vice-chairman of the Chia Tai Group of Companies (the Chinese arm of CP Group), said the joint venture with SAIC was looking for about 500 rai to build an automotive centre in Thailand.
The initial investments, he said, were aimed at assembling cars with 42% local content, a ratio that would rise once the new plant is ready in about four years.
He said the Thai operation aimed to be able to sell up to 60,000 units per year, with activity ramped up gradually in the years ahead. The first vehicle is set to roll out of the Thai plant for customers on July 1 this year and Mr Thanakorn has already booked the purchase for himself.
He predicted that popular models such as the Toyota Altis and Honda Civic would be the direct competitors for the MG 6 model but said “we have to create a brand and sell the strength of safety and standards”.
“We are not aiming high; we are looking for a market share of 2-3%. We are not going to go big all in one go,” he said, adding that success in Thailand would give the venture the confidence to focus on the wider Asean market.
“We will gradually increase the exposure to Asean with the various models manufactured in Thailand,” he said.
The initial lineup will consist of MG, which SAIC acquired in 2007, starting with the MG 6 model and then introducing other models gradually.
“We want to tap the Asean market and have an agreement with SAIC that the left-hand-drive vehicles will be made [in China] while right-hand-drive production would be undertaken in Thailand,” he said.
The company is already setting up service centres across Thailand with the initial focus in major cities including Bangkok, Chiang Mai and Phuket.
But it is not easy to convince car buyers to fork out money for a newcomer as resale value is a big consideration for any purchaser.
“What we are going to offer is a guaranteed price for those who sell their vehicles back to us,” said Mr Thanakorn, adding that as long as the vehicle is serviced at appropriate times and has no accidents, the fixed buyback prices would be applicable.
The company is also going to offer a special package to its employees so that they can drive the cars they make and be brand ambassadors for MG.
CP Group, which employs more than 300,000 people in businesses ranging from 7-Eleven and Makro to Charoen Pokphand Foods Plc and other assets, has a huge potential base of workers it can tap to help promote the vehicle.
“If we at CP don’t use them, then who will drive our vehicles? This would be a good marketing strategy as well,” he added.
Apart from the MG brand, the joint venture will also bring in the Maxus van, which will also target the Asean region.
The van segment, Mr Thanakorn stresses, has untapped potential that can help the SAIC-CP venture to be successful, as there is a heavy demand for vans in transport across Thailand and the region.
Maxus entered the SAIC stable after it acquired LDV Ltd, which was formed from the various mergers of British Leyland, the famous heavy vehicle maker.
“This is another area that we have not tapped into that has a niche,” he said.
Toyota vans, which are ubiquitous in Thailand for commuter services, are the only competitors in the niche that Maxus serves. The Chinese company intends to play up the vehicle’s British origins and their reputation as bigger, safer vans for buyers.
Some Maxus vans are already plying the streets of Bangkok and the brand will make its formal debut in Thailand starting this month. Mr Thanakorn says the vans are expected to attract attention gradually as the company looks at ways to adapt them to Thai and Asean tastes.
“We will undertake the interior decoration in Thailand as Thai people are really good at interior work, and I can assure you that it is a strong vehicle where there is only one strong competitor,” he said.
But the main challenge, he accepts, is changing the perception of Thai buyers toward Chinese products.
“We know about this issue, that the perception is not too good, so we have a tough job to try to market it in Thailand and the region,” he said.
“This is the global trend — manufacturing in China but having the quality of the West. Take the iPhone for example, where the product is made in China but quality is assured by Apple.”
The aim, he said, was to “to prove the quality and that is what we aiming for. … Once we achieve that we don’t need to be afraid of anything.”
To achieve this target the company has been testing the MG for the past six months or more and adapting it according to the tastes of regional drivers for both the passenger car and the van.
A plant visit to SAIC shows how the company has managed to use all of its knowhow from the various joint ventures in China to incorporate best practices into its own MG and Maxus vehicles.
The high degree of automation at the plant covering nearly 600 rai near Pudong Shanghai airport shows how far the Chinese state-owned enterprise has gone to adopt the best practices of global automakers.
SAIC, which acquired the nearly century-old MG in 2007, has gradually brought the British brand back to life and is now producing close to 250,000 units annually at its state-of-the-art Shanghai plant. It is now looking to expand the market in Asean which has not seen the MG for decades.
It is also exporting about 150,000 units back to the United Kingdom with the same production process that is used for the domestic market, with the only difference being right-hand drive.
Note sure about their sums but 150,000 MGs to the UK would be quite an achievement!
http://ift.tt/1j7c0Hx
SAIC Motor and partner CP Group see promising future in Asean for made-in-Thailand MG cars and Maxus vans.
Published: 7/04/2014 at 03:04 AM
Newspaper section: Asia focus
SAIC Motor, one of China’s leading automakers, is preparing to make Thailand the hub for its Asean expansion as it looks to expand sales of the various brands under its banner into the region.
A worker assembles an MG 6 car at the highly automated SAIC Motor plant covering a 600-rai site near Pudong Shanghai airport.
“We are looking to use our partnership to expand into the region in the years ahead and want to use Thailand as the hub,” said Yu Jingmin, the head of overseas operations for SAIC.
The Fortune 500 company last year produced close to 5 million vehicles through its partnerships with the likes of General Motors, Volkswagen, apart from commercial vehicles such as Iveco, not to mention its own Roewe brand and MG, the iconic British sports car marquee it owns.
SAIC is looking to tap the rising demand for vehicles in Asean through its partnership with Thailand’s largest agricultural conglomerate, Charoen Pokphand Group. CP, which also has extensive industrial, retail and telecoms interests, has invested about 10 billion baht to start up a plant in Thailand is also on the lookout to expand in the years ahead.
“This is the global trend — manufacturing in China but having the quality of the West. Take the iPhone for example, where the product is made in China but quality is assured by Apple” — THANAKORN SERIBURI, Chairman, SAIC Motor-CP Co
“We have put 10 billion baht into the first phase of investment in Thailand and the plant is currently located in Rayong although we are talking about relocating to Amata,” said Thanakorn Seriburi, the chairman of the newly formed automotive division at CP Group.
CP is well known for producing Tiger brand motorcycles in China, but it has been gradually adapting its strategy to move away from the motorcycle business as the Beijing government has made it a policy to ban the use of motorcycles in many highly congested cities.
Few governments in the world would have the clout to issue such a sweeping edict, and the ban has caused a lot of controversy in China. Officially, the government has said that it wants to alleviate traffic congestion and pollution and reduce traffic accidents, adding for good measure that it believes motorcycles are the main vehicles used for criminal activities.
“Once I heard that reason, I told everyone who is thinking of producing motorcycles that they can dream on, and in fact they should stop thinking about it altogether,” said Mr Thanakorn, noting that motorbike sales in China have dropped to 8 million a year from 20 million a few years earlier.
Mr Thanakorn, who is also the vice-chairman of the Chia Tai Group of Companies (the Chinese arm of CP Group), said the joint venture with SAIC was looking for about 500 rai to build an automotive centre in Thailand.
The initial investments, he said, were aimed at assembling cars with 42% local content, a ratio that would rise once the new plant is ready in about four years.
He said the Thai operation aimed to be able to sell up to 60,000 units per year, with activity ramped up gradually in the years ahead. The first vehicle is set to roll out of the Thai plant for customers on July 1 this year and Mr Thanakorn has already booked the purchase for himself.
He predicted that popular models such as the Toyota Altis and Honda Civic would be the direct competitors for the MG 6 model but said “we have to create a brand and sell the strength of safety and standards”.
“We are not aiming high; we are looking for a market share of 2-3%. We are not going to go big all in one go,” he said, adding that success in Thailand would give the venture the confidence to focus on the wider Asean market.
“We will gradually increase the exposure to Asean with the various models manufactured in Thailand,” he said.
The initial lineup will consist of MG, which SAIC acquired in 2007, starting with the MG 6 model and then introducing other models gradually.
“We want to tap the Asean market and have an agreement with SAIC that the left-hand-drive vehicles will be made [in China] while right-hand-drive production would be undertaken in Thailand,” he said.
The company is already setting up service centres across Thailand with the initial focus in major cities including Bangkok, Chiang Mai and Phuket.
But it is not easy to convince car buyers to fork out money for a newcomer as resale value is a big consideration for any purchaser.
“What we are going to offer is a guaranteed price for those who sell their vehicles back to us,” said Mr Thanakorn, adding that as long as the vehicle is serviced at appropriate times and has no accidents, the fixed buyback prices would be applicable.
The company is also going to offer a special package to its employees so that they can drive the cars they make and be brand ambassadors for MG.
CP Group, which employs more than 300,000 people in businesses ranging from 7-Eleven and Makro to Charoen Pokphand Foods Plc and other assets, has a huge potential base of workers it can tap to help promote the vehicle.
“If we at CP don’t use them, then who will drive our vehicles? This would be a good marketing strategy as well,” he added.
Apart from the MG brand, the joint venture will also bring in the Maxus van, which will also target the Asean region.
The van segment, Mr Thanakorn stresses, has untapped potential that can help the SAIC-CP venture to be successful, as there is a heavy demand for vans in transport across Thailand and the region.
Maxus entered the SAIC stable after it acquired LDV Ltd, which was formed from the various mergers of British Leyland, the famous heavy vehicle maker.
“This is another area that we have not tapped into that has a niche,” he said.
Toyota vans, which are ubiquitous in Thailand for commuter services, are the only competitors in the niche that Maxus serves. The Chinese company intends to play up the vehicle’s British origins and their reputation as bigger, safer vans for buyers.
Some Maxus vans are already plying the streets of Bangkok and the brand will make its formal debut in Thailand starting this month. Mr Thanakorn says the vans are expected to attract attention gradually as the company looks at ways to adapt them to Thai and Asean tastes.
“We will undertake the interior decoration in Thailand as Thai people are really good at interior work, and I can assure you that it is a strong vehicle where there is only one strong competitor,” he said.
But the main challenge, he accepts, is changing the perception of Thai buyers toward Chinese products.
“We know about this issue, that the perception is not too good, so we have a tough job to try to market it in Thailand and the region,” he said.
“This is the global trend — manufacturing in China but having the quality of the West. Take the iPhone for example, where the product is made in China but quality is assured by Apple.”
The aim, he said, was to “to prove the quality and that is what we aiming for. … Once we achieve that we don’t need to be afraid of anything.”
To achieve this target the company has been testing the MG for the past six months or more and adapting it according to the tastes of regional drivers for both the passenger car and the van.
A plant visit to SAIC shows how the company has managed to use all of its knowhow from the various joint ventures in China to incorporate best practices into its own MG and Maxus vehicles.
The high degree of automation at the plant covering nearly 600 rai near Pudong Shanghai airport shows how far the Chinese state-owned enterprise has gone to adopt the best practices of global automakers.
SAIC, which acquired the nearly century-old MG in 2007, has gradually brought the British brand back to life and is now producing close to 250,000 units annually at its state-of-the-art Shanghai plant. It is now looking to expand the market in Asean which has not seen the MG for decades.
It is also exporting about 150,000 units back to the United Kingdom with the same production process that is used for the domestic market, with the only difference being right-hand drive.
Note sure about their sums but 150,000 MGs to the UK would be quite an achievement!
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publié par vb @ 07:40
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