BEIJING -- A surprise policy shift in China is expected to give a boost to Volkswagen Group, General Motors and other foreign automakers planning to expand production. China said it would encourage foreign investment in vehicle manufacturing in its western region, reversing a policy to remove automaking from a list of industries qualifying for government incentives.
SHANGHAI -- BYD Co.'s stock price has jumped more than 80 percent since April, after U.S. billionaire Warren Buffett said his Berkshire Hathaway Inc. has no plans to sell its stake in the company. Investors doubtless are thanking Buffett for his kind words during his visit to China this week. But BYD could also use some kind words about its electric cars, which languish unsold on dealership lots. Most likely, though, it wouldn't matter. Pictured: Yang Jian is managing editor of Automotive News China.
FRANKFURT -- Volkswagen Group plans to produce cars for a planned budget brand in China with joint-venture partner FAW Car Co., two people familiar with the matter said. VW aims to introduce the new low-cost marque in three years and eventually may expand it to more than one model, the sources said.
SHANGHAI -- Daimler AG CEO Dieter Zetsche was leaning back in the rear seat of a prototype Mercedes-Benz S-class sedan in 2010 when he realized it didn't recline far enough. With wealthy consumers accustomed to sumptuous airline seats, he figured Mercedes needed to approach that level of comfort in its flagship model. "Engineers traditionally focus on the driver seat position," Zetsche said in an interview. "S-class owners often experience their car from 'the second row,' especially in China," where luxury cars are frequently driven by chauffeurs.
Dongfeng Motor Corp., the second-largest Chinese automaker, will buy a stake in a smaller state-owned rival amid efforts by the government to create more competitive carmakers. Dongfeng will inject capital into Fujian Motor Industry Group Co. in exchange for an undisclosed stake from the Fujian provincial government, according to an e-mailed statement.
Volkswagen-brand sales in China and Hong Kong edged up 3 percent in April to 185,800 units though the German marque failed to keep pace with the industry. Sales of passenger vehicles in China rose 13 percent in April on strong demand for SUVs and new models. In the first three months, the VW brand generated sales of 783,900 units in China, up 20 percent year on year.
The new Mercedes-Benz S class made its world premiere Wednesday in Hamburg, Germany, but Shanghai might have been more appropriate. Why? China accounted for 49 percent of all S-class sales from 2010-12. By comparison, 15 percent of total S-class sales were in Europe during the three-year period and the United States accounted for 21 percent of the total, according to figures from market researcher JATO Dynamics. Douglas A. Bolduc is Managing Editor of Automotive News Europe.
STUTTGART -- Porsche AG named Deesch Papke, 51, as its new China CEO, essentially switching him with the executive he will replace. On July 1, Porsche's current China CEO, Helmut Broker, will take charge of sales in Asia, Africa, Australia and South America. During his six-year stint in China, Broker raised Porsche sales sixfold.
PRAGUE, Czech Republic -- Czech automaker Skoda said April vehicle sales in China were flat year-on-year at 20,400 units. For the first four months, Volkswagen AG's value brand said deliveries in China declined 2 percent to 79,600 units. To boost sales in its largest global market, Skoda plans to introduce the locally produced five-door Rapid sedan and two import vehicles, the Yeti compact SUV and the Superb Combi wagon.
Chinese auto dealership returns will decline as automakers add more stores, intensifying competition, research firm Sanford C. Bernstein says in a report. Foreign automakers are expanding distribution in China's central and western regions and into less-developed cities dominated by domestic brands. Meanwhile, local marques are targeting higher-income buyers with more sophisticated products, according to the Bernstein note distributed Tuesday. "A crunch in returns is inevitable," analysts led by Max Warburton wrote in the report.