Byline: Kandy Wong
Date: 23.08.2007
Page: 01

Chery Automobile, which makes the popular QQ cars, produced its one millionth vehicle yesterday, taking less than eight years or the shortest time to reach "the million milestone" among domestic carmakers.

The millionth car is an A3, a four-door hatchback that made its debut at last year's Beijing International Car Show. The model is expected to hit the streets later this year.

The company said it took about six years to produce its first 500,000 cars and only a year and a half to complete the second 500,000.

Chery reached the milestone in record time by making popular, low-end cars at a time when demand is growing rapidly in the country.

The mainland became the world's second-largest car market last year, selling 7.22 million vehicles, up 25 per cent from 2005.

The government expects sales to reach 8.5 million vehicles this year, up 18 per cent.

The low-end economy cars from Chery, with prices ranging from 30,000 yuan to 60,000 yuan, tap a large segment from second and third-tiers cities.

Sino-German carmaker FAW Volkswagen spent 13 years making its first million cars. It took more than eight years for Shanghai General Motors and Guangzhou Honda to reach their benchmarks.

Chery, the fourth-largest domestic carmaker by production, is capable of producing 400,000 cars, 400,000 engines and 300,000 transmission cases units a year and plans to raise its annual output to one million cars by 2010.

Anhui-based Chery has set a target of 390,000 cars this year with 70,000 units for export. The company reported sales of about 310,000 units last year including 40,000 units sold overseas.

Chery is the nation's largest car exporter, selling 153,694 overseas since 2001. Domestically, its market share is 7.2 per cent.

Chery chairman Yin Tongyiu said the company's next goal was to boost the international image of its cars.

Last month, the company signed a deal with US carmaker Chrysler to become the first mainland carmaker to sell vehicles in the United States. It will help develop, assemble and distribute Chery's small and subcompact cars in North America, Europe and other markets under Chrysler's Dodge brand.

Chery also set up a joint venture with Italian manufacturer Fiat this month to make cars in the mainland for distribution domestically and in Italy.

"Chinese carmakers, with their inexpensive small cars, can help salvage the sliding market share of global carmakers in their countries," said Pedro Neuno, the executive president of the China Europe International Business School in Shanghai. "Co-operation with global carmakers is good for lifting China cars' technological skills."