GAC gears up for ma­jor ca­pac­ity ex­pan­sion

China Daily (USA) - - BUSINESS - By QIUQUANLIN in Hangzhou qiuquanlin@chi­

Guangzhou-based au­tomaker GAC Mo­tor Co Ltd on Wednes­day be­gan ma­jor ren­o­va­tions of its assem­bly plant in Hangzhou, cap­i­tal of Zhe­jiang prov­ince, in a push to ex­pand pro­duc­tion ca­pac­ity fol­low­ing sub­stan­tial sales growth.

The up­grade comes af­ter the com­pany ac­quired GAC Gonow in April — a joint ven­ture be­tween Guangzhou Au­to­mo­bile Group Co and Zhe­jiang Gonow Hold­ings Group Co.

“The fa­cil­i­ties in Hangzhou will help ex­pand pro­duc­tion ca­pac­ity and boost our po­si­tion in the fast-grow­ing eastern China mar­ket, as we are gear­ing up to meet the grow­ing do­mes­tic de­mand,” said GAC Mo­tor Gen­eral Man­ager Yu Jun.

GAC Mo­tor sold 219,000 units of its Trumpchi car brand in the first eight months of this year, a mas­sive 151 per­cent year-on-year in­crease.

“Af­ter years of ef­fort in re­search and de­vel­op­ment, the mar­ket de­mand for high­end homegrown ve­hi­cles has sur­passed cur­rent pro­duc­tion ca­pac­ity,” Yu said.

Ve­hi­cle sales in the Chi­nese mar­ket grew by a much more mod­est 11.4 per­cent year-onyear from Jan­uary to Au­gust, ac­cord­ing to the China As­so­ci­a­tion of Au­to­mo­bile Man­u­fac­tur­ers.

Yu said GAC Mo­tor’s Guangzhou fa­cil­i­ties cur­rently pro­duce 400,000 ve­hi­cles an­nu­ally, while its man­u­fac­tur­ing line in the Xin­jiang Uygur au­tonomous re­gion, cur­rently un­der con­struc­tion, is de­signed to pro­duce 100,000 units an­nu­ally.

“Es­tab­lish­ment of the Xin­jiang fa­cil­ity will al­low us to tap the far north­west­ern China mar­ket, while the Hangzhou project will help boos­t­our­p­res­ence in eastern China,” Yu said.

GACMo­tor’s sales in eastern China grew 171 per­cent yearon-year to 39,000 units in the first eight months.

GAC Mo­tor, which was es­tab­lished in 2008, will in­vest 3.75 bil­lion yuan ($562.1 mil­lion) in the ren­o­va­tion of the Hangzhou project, with a de­signed an­nual pro­duc­tion ca­pac­ity of 200,000 ve­hi­cles, ac­cord­ing to Yu.

TheHangzhou fa­cil­i­ties will go into op­er­a­tion by Oc­to­ber next year, while con­struc­tion of its new Xin­jiang assem­bly line, which will fo­cus on pro­duc­tion of medium and high­end SUVs and new-en­ergy ve­hi­cles, be­gan in Au­gust.

Hangzhou Deputy Mayor Ma Xiao­hui said the GAC assem­bly fa­cil­i­ties would help op­ti­mize the city’s in­dus­trial struc­ture.

“The new assem­bly line, based on GAC Mo­tor’s high­end re­search and de­vel­op­ment plat­form, will help de­velop a new growth en­gine for the lo­cal econ­omy,” Ma said.


Yu Jun (cen­ter), gen­eral man­ager of GAC Mo­tor Co, in­tro­duces car mod­els to guests in Hangzhou, Zhe­jiang prov­ince, on Wednes­day.

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