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China's automakers fight back

News, 20 April 2015

SHANGHAI: China's automakers are fighting back against the widespread perception that they are of inferior quality to foreign brands, with a range of new models incorporating local and overseas design to be unveiled at the Shanghai Motor Show.

"Chinese manufacturers are managing to improve their product quality and design quickly and make them almost comparable to international brands while keeping their price much lower," according to John Zeng, an industry analyst at market intelligence firm LMC Automotive.

And the strategy appears to be paying off: Geely, which acquired the Volvo brand in 2010, reported the number of vehicles sold under its own brand jumped 57% in the first quarter.

SINA listed similar advances at other Chinese automakers, with February sales at Changan up 78% on the previous year, while Great Wall Motor's Haval brand was up 79%.

Foreign brands have also been losing some of their shine recently, being criticised for overcharging at service centres, while Jaguar Land Rover was accused of knowingly selling models with faulty gearboxes.

Overall, LMC said, Chinese brands now accounted for 43% of the country's light vehicle market, up from 38% at the same time last year.

The new approach being taken by Chinese firms is evident in Geely's Borui sedan, which it will be showing at this week's Shanghai Motor Show. The company described it as a "true international car brand in terms of design", with input from a 200-strong team across studios in China, Sweden, Spain and the US.

Zeng highlighted the price – around 110,000 yuan ($18,000), compared with 170,000 yuan to 300,000 yuan ($28,000 to $49,000) for a similar foreign brand sedan. "That basically is providing the market with a mid-size car at the price of a compact car," he said.

The design process is also working in the opposite direction as overseas brands start to develop models aimed specifically at sections of the Chinese market.

Nissan, for example, will unveil the Lannia, a mid-size sedan it described as its "first product specially created for the youth generation in China." And Volkswagen also intends to show a new model designed for this country.

Data sourced from SINA English; additional content by Warc staff