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As reported today
Beijing Auto seeks passenger car expansion
Published: 23 Dec 2009 10:02:02 PST
By Chen Xiaomin
Beijing Automotive Industry Holding said Wednesday it would develop three to four passenger vehicles based on technology purchased from Saab in the next three years.
China's fifth biggest automaker by sales, Beijing Automotive said at a press confer-ence Wednesday for the first time that it had spent $200 million to acquire intellectual property rights for three vehicle platforms, two engine series and two gearboxes.
Beijing Automotive bought the Epsilon 1, GM2900 and GM2400 platforms, which are used to produce models including Saab's existing 9-3 and 9-5. The two engine series – the 2.0 L series and the 2.3 L series – Beijing Automotive bought from Saab each includes four variants.
The purchase also included the F25 and F35 transmissions, as well as documents related to R&D, supplier management, manufacturing and quality management for the technical property.
"The documents, which would enable the company to produce continuously reliable cars, are equally important as the property rights," said the automaker's chairman, Xu Heyi.
The proprietary rights and technical documents will save five to six years of R&D time, the company wrote in a document distributed to journalists at the press conference, adding that it will spend 33 billion yuan ($4.83 billion) on its passenger vehicle division, developing new models and constructing production bases and power-train plants.
The company's Beiqi Foton ranks first among China's commercial vehicle producers by sales, and is also one of the strongest automakers worldwide. Yet its passenger vehicle arm is quite weak due to limited production and R&D experience.
Beijing Automotive aims to make two to three turbo engines and three to four medi-um- and high-end sedans based on Saab technologies within three years, said the document.
"We plans to make 100,000 self-developed vehicles as of 2011, among which two-thirds will be sedans," said Xu, adding two will be launched at the end of 2010.
Xu said the company will finish constructing a passenger vehicle production base in Shunyi, Beijing in 2011. The company will develop new energy vehicles concurrently with traditional-fuel-powered vehicles, Xu added.
Lin Yi, general manager of Beijing Automotive's new energy arm, told the Global times the company will also pursue cooperation on new energy vehicle technology with Saab.
Xu neither confirmed nor denied when asked if Beijing Automotive would buy other assets from Saab.
Dutch luxury carmaker Spyker was in talks to buy Saab from GM, but those negotiations broke down last week. But Russia-backed Spyker said this week it was still interested in a deal for Saab.
Xu told the Global Times Beijing Automotive is working to close a deal to buy a more than 40 percent stake in Fujian Daimler Automotive, a process that has been going on for six months.
Meanwhile, Beijing Automotive is also seeking approval for an IPO.
Beijing Automotive has posted a net profit of 6 billion yuan ($878.77 million) on revenue of 116 billion yuan ($16.99 billion) in 2009, selling 1.24 million vehicles.
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