Chery Automobile

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This article is about a Chinese car-maker. For other uses, see Chery (disambiguation).
Chery Automobile Co Ltd
Type Government-owned corporation
Industry Automotive
Founded March 18, 1997 in Wuhu, Anhui Province, China
Headquarters Wuhu, Anhui Province, China
Key people Yin Tongyue (尹同躍), Chairman
Products Automobiles
Website cheryinternational.com

Chery Automobile Co Ltd[1] (simplified Chinese: 奇瑞汽车股份有限公司; traditional Chinese: 奇瑞汽車股份有限公司; pinyin: Qíruì Qìchē, English pronunciation: /ˈʃɛri/) is a state-owned[1] automobile manufacturer in the People's Republic of China. It has been the seventh-largest China-based automaker measured by unit production for at least two years running.

Contents

[edit] History

Founded as a state-owned enterprise in 1997, auto production commenced in 1999[1] using a chassis licensed from Volkswagen's SEAT Toledo.[2] Early production may have been technically illegal, as the company was only awarded a passenger car production license in 2003; until that year it may have piggybacked on a SAIC Group license.[3]

In 2009 Chery produced 508,500 units,[4] although by that time it probably had a per-year production capacity of 650,000.[5] More than 400,000 of its 2009 sales were sedans.[6] Production capacity figures may consider engines and vehicles as discrete.

Chery became the 7th most-productive Chinese vehicle manufacturer in 2010, selling nearly 700,000 units.[7] In the first 11 months of 2011, production reached 578,400 units and Chery still holding on to their seventh position in the Chinese market.[8]

[edit] Export champion

Making its first export to Syria in 2001,[9] as of 2010 Chery was the top exporter among Chinese automakers, a title it held since 2003.[10] Many of these exports may be in the form of knock-down kits.[citation needed]

Selling in several other continents besides, Chery has established dealerships throughout Europe in Russia, Ukraine, Belarus, Serbia, Macedonia, Turkey and in Italy through the DR Motor Company.[11] Other notable nations where Chery models are on offer as of 2012 include Australia,[12] Singapore,[13] and South Africa.[14] One of Chery's strategic goals is to expand in developing countries first and then in developed countries.[15] In Ukraine, Chery models are sold by UkrAVTO Corp,[16] and partner firms operate sales outlets in other markets as well. In some nations, however, companies Chery cooperates with build models in their own small factories.[ambiguous]

As of the beginning 2011, Tiggo was the most popular model in export markets.[16]

[edit] SAIC

It may have been affiliated with SAIC at one time.[17] SAIC may have sold its ownership in the company back to Chery in 2004 due to a rising tension between Chery and its other foreign partners General Motors and Volkswagen.

[edit] Unconsummated Chrysler cooperation

When Cerberus Capital Management owned Chrysler, this company planned a cooperation with Chery that would have seen the Chery A1 and its underpinnings sold under the Dodge brand name in the US and abroad.[18] The plan would have quickly increased the Chrysler small car stable, and the two companies participated in a signing ceremony in late 2007.[19] In early 2008 a similar deal was reached between Chrysler and Nissan, and the Chrysler-Chery cooperation was abandoned.[20]

Around the time of the 2009 Chrysler Chapter 11 reorganization, this American automaker discussed the possibility of an asset sale with Chery.[21]

[edit] Unconsummated Fiat joint venture

In 2007 Fiat and Chery signed a MoU on the creation of a Sino-Italian car-making joint venture. It was supposed to initiate activities in 2009, make Fiat and Alfa Romeo-branded products for the Chinese market, and be located in Wuhu, Anhui province.[22]

The deal was put on hold in March, 2009.[23]

[edit] Operations

[edit] China

Chery has several production bases in China,[24] and at least one in its home province of Anhui,[18] probably in Wuhu City.[25] As of 2007 the company had two auto-making production bases, two engine-making bases (the No.2 base having built ACTECO-branded engines and being "highly automated"), a gearbox production base, and two units presumably tasked with R&D.[24] Another car-making production base should have become operational by early 2008.[24] A Dalian, Liaoning province, base will be finished by the end of 2011.[25]

An R&D centre exists and may be located in Wuhu, Anhui province, as this is where the company is based.[26]

Chery has a handful of Sino-western joint ventures, most with component manufacturers such as Arvin Meritor, Johnson Controls[27] and PPG Industries.[citation needed].

[edit] Other

There are many small factories in developing countries manufacturing Chery models. These factories build from either complete or semi-complete knock-down kits and,[15] with the exception of an Argentinian cooperation[28] and an Iranian factory,[29] are not necessarily owned by or affiliated with Chery. Sales of knock-down kits are an easy way for Chery to gain access to growing markets without added after-sales service costs.

Such overseas knock-down factories may spring up and disappear quickly. As of 2007 there were 14 overseas factories,[24] but by mid-2009 that number had dropped to ten[9] only to rise again to a projected 15 by the end of that same year.[30] As of the beginning of 2012, 13 operational factories produce Chery vehicles and an additional three should come online soon.[31]

These factories have appeared in Argentina, Egypt, Indonesia,[32] Iran,[29] Malaysia,[32] the Middle East,[28] North Africa,[28] Pakistan,[33] Uruguay,[32] Russia,[32] Taiwan,[30] Thailand, the Ukraine,[32] and Vietnam.[34] Besides the Ukrainian site another Eastern European site may exist.[28] This may be in Serbia, as Chery exhibited at a 2011 Belgrade auto show.[31]

[edit] Brazil

Chery has agreed to the construction of a Jacarei, Brazil, production base that should be finished by 2013 in a joint effort with the Government of the state of São Paulo.[35] In July of 2011 work commenced on an industrial park with a planned 150,000 unit/year production capacity.[31]

[edit] Egypt

Assembly of Chery cars from complete knock-down kits began in Egypt in 2004,[36] and as of 2011 in this country they are sold under the Speranza brand name. and in this country they may be sold under the brand name Speranza Chery.[37][38] One Egyptian factory making Chery models from semi-complete knock-down kits had a 2009 production capacity of 30,000 vehicles/year.[39]

In 2011, Chery stated the part localization ratio for Egypt was 45%.[40]

[edit] Indonesia

As of 2011, Cherys will be manufactured and marketed in this country by a new local partner company, PT Karya Semesta Investama (KSI). KSI replaces the Indomobil Group as Chery's local partner.[41]

[edit] Iran

As of late 2007 Chery has a minority ownership in a joint venture with Iranian Khodro and Canadian Solitac as its partners. This JV controlled a knock down factory in Babol, Mazandaran. Making a QQ6 renamed the S21, it may be sold both inside and outside Iran[29] and carry a name other than Chery, as well.[citation needed]

[edit] Myanmar

As of May 2011, a 3,000 to 5,000 unit/year production facility is planned in the country.[31]

[edit] Russia

In Russia TagAZ produces Chery vehicles, but these usually carry non-Chery badges such as "Vortex".[42]

[edit] Taiwan

The Chery A3 is assembled since August 2009 in Taichung, Taiwan by Shengrong Auto, a subsidiary of Prince Motors (Chinese: 太子汽車; pinyin: Tàizǐ Qìchē), a Taiwanese car company.[30][43]

[edit] Thailand

As of late 2008 Chery exports semi-complete knock-down kits for assembly in Thailand.[44]

[edit] Turkey

A production site was planned to be raised in the province of Sakarya, in a collaboration with the local Chery dealer, Mermerler Otomotiv.[45]

[edit] Ukraine

Chery Automobile is a partner of ZAZ since 2006[46] and manufactures from CKD kits some of its vehicles in the plants from Zaporizhia and Illichivsk. Since February 2011, the Chery A13 is manufactured on full-scale in Ukraine, where it is sold rebadged as the ZAZ Forza.[47]

[edit] Uruguay

Affiliated Argentinian company SOCMA Group[28] manufactures some of the Chery vehicles in the Oferol factory from Barra de Carrasco, Canelones, Uruguay.[48] The Tiggo was officially launched in Uruguay in October 2007.[49][50]

[edit] Venezuela

First introduced to this country in mid-2006, Chery vehicles continued to be the only licensed Chinese car exports to Venezuela as of 2011.[40] Opened in September 2011, a new Chery production site in the north-central state of Aragua, owned by the ZGT joint venture, produces the A1 and A3 models.[51]

[edit] Products and services

[edit] Vehicles

Main article: List of Chery models

As of 2009, Chery products sell under at least four brand names. These include Karry, Rely, Riich, and its own.[52] Vehicles adapted to the European Union standards are sold in Italy through the DR Motor company.

Chery makes cars, minivans, and SUVs. The parts used in their manufacture may be foreign designed, and some may be imported; Chery has cooperative agreements with many foreign component firms, including the American ArvinMeritor,[53] American Autoliv,[54] American Delphi Automotive,[54] the Australian company Futuris,[54] German Robert Bosch GmbH,[53] American PPG Industries,[53] German Siemens VDO,[53] French Valeo,[53] and the American Visteon.[55]

Some have helped Chery establish a local supply chain.[53]

[edit] Engines

The company makes and has exported engines under the brands ACTECO and CAC. Chery engines have been bought by Fiat and exported to the US.[24][56]

[edit] Domestic after-sales service

The company has a customer service network that spans at least 31 Chinese provinces, autonomous regions, and direct-controlled muicipalities.[57][58]

[edit] Electric vehicles

An electric Chery Riich M1 at the 2010 Kuala Lumpur International Motor Show

Like many Chinese automakers, Chery wants to produce electric vehicles in the future. The company currently offers a few hybrid and full-electric models, and it has established a tentative agreement with a foreign company for mass-production. China subsidies oil (an incentive for the State to encourage use and manufacture of electric cars),[59] and some of its automakers see opportunities in less mature electric vehicles because Western companies have yet to develop much of a lead in the technology.[60]

[edit] International cooperation

Chery and Quantum LLC, an Israel Corp subsidiary, formed a joint venture in 2007 to build electric cars. A proposed production base for this JV may be built in Changshu, Jiangsu province, becoming operational in 2012.[61]

Another company, the American Better Place, signed a 2010 MoU with Chery for the development of prototype electric vehicles to be used in its pilot projects.[62]

Chery Auto and Magna Steyr, a division of the Canadian manufacturer Magna International, are cooperating to develop three models of the Qoros brand for sale in Europe, reports Motoren in Sept 2011. The new car will be developed by Magna for production in Changshu near Shanghai.[63]

[edit] Electric models

In 2009 Chery announced it had built an all-electric car, the S18.[64]

In early 2009 the company showed an all-electric Chery Riich M1 to journalists.[5] This car, also referred to as the S18, may have entered production in 2010.[26]

As of 2011 the company continued to pour R&D dollars into this area,[65] and offers three hybrid and two all-electric models.[66] Its hybrid models may use a start-stop system solely.

[edit] Motorsport

Chery participated in the 2010 and 2011 Dakar Rally, racing with Rely X5 SUVs in both editions.[67][68]

[edit] Safety record

An informal, 2007 Russian crash test yielded a poor score for a Chery model named the Amulet, but a later test on Chinese soil saw this model, sold on the Russian market, far better.[69]

The 2009 A3 received a five-star safety rating in C-NCAP, the Chinese new car safety tests,[70] becoming the first indigenous car to achieve such a high-test rating.[58][71]

[edit] Corporate social responsibility

Chery's corporate social responsibility activities include sponsoring forests with a sand-control purpose and donations to disaster relief efforts.[72]

[edit] Controversies

[edit] Copying claims

The Chery QQ (left) and Daewoo Matiz (right)

In June, 2003, American company General Motors sued Chery accusing it of copying the first generation Daewoo Matiz (developed by a GM subsidiary, GM Daewoo) in its design for the Chery QQ.[73] General Motors then went on to accuse Chery of using a disguised Matiz in a crash test for the Chery QQ.[74]

GM executives claimed design duplication, with many parts interchangeable between the QQ and the Matiz,[17] and GM China Group stated the two vehicles, "shared remarkably identical body structure, exterior design, interior design and key components."[75]

While some Chery cars are not copies, such as the Pininfarina-designed A3,[76] the QQ may not be the sole Chery model that wears famous-name designs; the Chery Tiggo is criticized for resembling the second generation Toyota RAV4.[77] Other model using the Matiz technology found in the QQ include the closely related QQ6. The Eastar and its derivatives (V4, B12, and B22) have also been considered to be copies, of the Daewoo Magnus.[78]

[edit] GM lawsuit

After mediation attempts failed, then-GM Daewoo (now known as GM Korea) brought a case against Chery in a Shanghai court, but by 2005 jurisdiction had been moved[17] to the Beijing No.1 Intermediate People's Court.[79]

Around that time Chinese state officials, including a vice-minister of commerce and a vice-director of the State Intellectual Property Office, publicly supported Chery. The Chinese have claimed that GM didn't properly patent their technology.[79] In late 2005 the lawsuit was settled.[74]

[edit] Bricklin U.S. court case

An American entrepreneur with past experience importing developing country autos to the U.S., Malcolm Bricklin, sued Chery in 2008 for contracting a different company after previously contracting Bricklin.[80]

[edit] See also

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[edit] References

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  80. ^ "Entrepreneur Bricklin sues Chery over failed deal". Reuters. 2008-07-21. http://www.reuters.com/article/2008/07/21/us-chery-lawsuit-idUSN2141944520080721. 

[edit] External links

Chery Automobile
A Segment
QQ3  • QQ6  • QQme  • M1
B Segment
A1  • A13  • A15
C Segment
A3  • A5
D Segment
Eastar  • G5  • G6
SUV and MPV
X1  • Eastar Cross  • Tiggo  • X5
Vans
A18  • S22  • Q21  • Q21D  • Q22  • Q22B  • H5
Retrieved from "http://en.wikipedia.org/w/index.php?title=Chery_Automobile&oldid=478985036"
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