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Chery

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This article is about a Chinese car-maker. For other uses, see Chery (disambiguation).
Chery Automobile Co Ltd
Company typeGovernment-owned corporation
IndustryAutomotive
FoundedMarch 18, 1997 in Wuhu, Anhui Province, China
HeadquartersWuhu, Anhui Province, China
Key people
Yin Tongyue (尹同躍), Chairman
ProductsAutomotive goods
Websitecheryinternational.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, /ˈʃɛri/) is a state-owned[1] automobile manufacturer in the People's Republic of China. Chery has been China's seventh most productive automobile manufacturer for at least two years running.

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]

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.[11] Other notable nations where Chery models are on offer as of 2012 include Australia,[12] Singapore,[13] and South Africa.[14] This follows one of Chery's strategic goals which is to expand in developing countries first, 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.

Tiggo, a small SUV, has been a popular offering in many countries.[16]

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.

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]

Unconsummated Fiat joint venture

In 2007 Fiat and Chery signed a MoU on the creation of a Sino-Italian car-making joint venture.[22] 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]

Dakar rally

Participating in the 2011 and 2010 Dakar Rally, it used Rely X5 SUVs for both races.[24]

Operations

China

Chery has several production bases in China,[25] and at least one in its home province of Anhui,[18] probably in Wuhu City.[26] 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.[25] Another car-making production base should have become operational by early 2008.[25] A Dalian, Liaoning province, base will be finished by the end of 2011.[26]

An R&D centre exists and may be located in Wuhu, Anhui province, as this is where the company is based.[27]

Chery has a handful of Sino-western joint ventures, most with part or component manufacturers.[28] These companies include Arvin Meritor,[28] Johnson Controls[28] and PPG Industries.[citation needed]

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,[29] with the exception of an Argentinian cooperation[30] and an Iranian factory,[31] 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,[25] 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.[32] As of the beginning of 2012, 13 operational factories produce Chery vehicles and an additional three should come online soon.[33]

These factories have appeared in Argentina, Egypt, Indonesia,[34] Iran, Malaysia,[34] the Middle East,[30] North Africa,[30] Pakistan,[35] Uruguay,[34] Russia,[34] Taiwan,[32] Thailand, the Ukraine,[34] and Vietnam.[36] Besides the Ukrainian site another Eastern European site may exist.[30] This may be in Serbia, as Chery exhibited at a 2011 Belgrade auto show.[33]

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.[37] In July of 2011 work commenced on an industrial park with a planned 150,000 unit/year production capacity.[33]

Egypt

Assembly of Chery cars from complete knock-down kits began in Egypt in 2006, and in this country they may be sold under the brand name Speranza Chery.[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]

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]

Iran

As of late 2007 Chery has a minority ownership in a joint venture with Iranian Khodro and Canadian Solitac as its partners.[31] This JV controlled a knock down factory in Babol, Mazandaran.[31] Making a QQ6 renamed the S21, it may be sold both inside and outside Iran[31] and carry a name other than Chery, as well.[citation needed]

Myanmar

As of May 2011, a 3,000 to 5,000 unit/year production facility is planned in the country.[33]

Russia

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

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.[43][44]

Thailand

As of late 2008 Chery exports semi-complete knock-down kits for assembly in Thailand.[45]

Turkey

A production site was planned to be raised in the province of Sakarya, in a collaboration with the local Chery dealer, Mermerler Otomotiv.[46]

Ukraine

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

Uruguay

Affiliated Argentinian company SOCMA Group[30] 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]

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, Venezuela produces the A1 and A3 models.[51]

Products and services

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]

Engines

The company makes and has exported engines under the brands ACTECO and CAC.[25] Chery engines have been bought by Fiat[25][56] and exported to the US.[25]

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] As of 2009 it offered a warranty of four years/120,000 km.[58]

Electric vehicles

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

Like many Chinese automakers, Chery want 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), 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.[59]

International cooperation

Chery and Quantum LLC, an Israel Corp subsidiary, formed a joint venture in 2007 to build electric cars.[60] A proposed production base for this JV may be built in Changshu, Jiangsu province, becoming operational in 2012.[60]

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.[61]

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.[62]

Electric models

In 2009 Chery announced it had built an all-electric car, the S18.[63]

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.[27]

As of 2011 the company continued to pour R&D dollars into this area,[64] and the official Chery website lists three hybrid and two all-electric models.[65] Its hybrid models may use a start-stop system solely.

Safety performance

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, fare better.[66]

The 2009 A3 received a five-star safety rating in C-NCAP, the Chinese new car safety tests,[67] becoming the first indigenous car to achieve such a high-test rating.[58][68]

Corporate social responsibility

Its CSR activities comprise sponsored forests with a sand-control purpose[69] and donations for disaster relief.[70]

Controversies

While a state-owned company, Chery seems to engage in practices such as copying that are more usual among private Chinese automakers.

Copying claims

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.[71][72] General Motors then went on to accuse Chery of using a disguised Matiz in a crash test for the Chery QQ.[72]

GM executives claimed design duplication,[73] 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."[73]

While some Chery cars are not copies, such as the Pininfarina-designed A3,[74] 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.[75] 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.[76]

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.[77]

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.[77] The Chinese have claimed that GM didn't properly patent their technology.[77] In late 2005 the lawsuit was settled.[72]

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.[78]

See also

References

  1. ^ a b c Overview Chery Official Website
  2. ^ Li, Wei (May 19, 2008). "Yin Tongyue: There's no myth to cars (qiche meiyou shenhua)". Sanlian Lifeweek (sanlian shenghuo) (in Chinese). pp. 56–61.
  3. ^ Chang, Crystal (2009). Developmental Strategies in a Global Economy: The Unexpected Emergence of China’s Independent Auto Industry. p. 13. Retrieved 01/04/2012. {{cite conference}}: Check date values in: |accessdate= (help)
  4. ^ "2009年安徽汽车年产量破90万辆". Midchina.xinhuanet.com. 2010-01-29. Retrieved 2010-10-05.
  5. ^ a b Young, Confident, Progressive - Overseas Media Speak Highly of Chery’s Internationalization Chery Official Site, 2009.04.29
  6. ^ "2009 Chinese Auto Sales". Nitrobahn.com. 2010-01-20. Retrieved 2010-10-11.
  7. ^ China Car Market 101: Who Makes All Those 18 Million Cars? thetruthaboutcars.com, January 19, 2011
  8. ^ 2011年1-11月前十家汽车生产企业销量排名. China Association of Automobile Manufacturers (CAAM). 12/16/2011. Retrieved 01/07/2012. {{cite conference}}: Check date values in: |accessdate= and |date= (help)
  9. ^ a b Chery, the Only Automaker Listed Among Top 200 Chinese Exporters Chery Official Site, 2009.06.18
  10. ^ Chery ranks 1st in exports for 8 consecutive years Chery Official Site, 2010.12.29
  11. ^ Chery dealerships in Russia, Ukraine, Belarus, Serbia, Macedonia, Turkey and Italy
  12. ^ "Chery Cars". Retrieved 01/01/2012. {{cite web}}: Check date values in: |accessdate= (help)
  13. ^ "CHERY". Vertex Automobile Pte Ltd. Retrieved 01/01/2012. {{cite web}}: Check date values in: |accessdate= (help); Text "Homepage" ignored (help)
  14. ^ "Chery South Africa". Chery South Africa. Retrieved 01/01/2012. {{cite web}}: Check date values in: |accessdate= (help)
  15. ^ "Chery international". Chery International. Retrieved 2011-10-29.
  16. ^ a b "Chery's First-Three-Quarter Exports Top 120,000 Units". Chery Inc. Oct 20 2011. Retrieved 12/31/2011. {{cite news}}: Check date values in: |accessdate= and |date= (help)
  17. ^ a b c "GM Daewoo claimed their investigation results showed the Chery QQ shared a remarkably identical body structure, exterior design, interior design and key components". BBC News. 2005-05-09. Retrieved 2010-10-05.
  18. ^ a b Rating the Chery wsj.com, AUGUST 25, 2007
  19. ^ Chery and Chrysler Group Finalize Cooperative Agreement Chery Official Site, 2007.07.10
  20. ^ Chrysler's turnaround seen as race against time reuters.com, Mon Sep 14, 2009 3:13pm EDT
  21. ^ Chrysler renews search for China partner: sources reuters.com, Wed Aug 26, 2009 4:27pm EDT
  22. ^ a b Chery and Fiat Reached a Memorandum of Understanding Chery Official Site, 2007.08.06
  23. ^ China's Chery postpones car venture with Fiat reuters.com, Thu Mar 19, 2009 1:46am EDT
  24. ^ For 2011 Dakar entry and use of of Rely X5, see Rely X5 test for Dakar, Lu Ningjun satisfied with preparations Chery Official Site, 2010.11.14
  25. ^ a b c d e f g Ten-Years Innovation, One Million Chinese Cars Chery Official Site, 2007.08.21
  26. ^ a b Chery Auto Breaks Ground on Dalian Plant Chery Official Site, 2009.10.15
  27. ^ a b Chery's First High-speed BEV S18 Passed National Collision Test Chery Official Site, 2009.08.31
  28. ^ a b c Joining Hands with Arvin Meritor, Chery More Confident of Internationalization Chery Official Site, 2007.07.26
  29. ^ Chery International Chery Official Site
  30. ^ a b c d e A Chinese Independent Brand Seizes the First Bridgehead in Latin America Chery Official Site, 2007.03.31
  31. ^ a b c d Chery, Iran Khodro and Canada Solitac Enter into an Agreement of Joint Venture Chery Official Site, 2007.08.09
  32. ^ a b Chery A3 Produced in Taiwan Chery Official Site, 2009.08.20
  33. ^ a b c d "Growth 2011--Chery International Makes New Leap". Chery Inc. Dec 30, 2011. Retrieved 12/31/2011. {{cite news}}: Check date values in: |accessdate= (help)
  34. ^ a b c d e Overseas Factories Chery Official Site
  35. ^ Chery Signs Agreements with New Pakistan Distributor Chery Official Site, 2010.11.03
  36. ^ Chery Officially Enters Vietnamese Market Chery Official Site, 2009.04.22
  37. ^ "Chery Plans Production Base in Jacareí, Brazil". ChinaAutoWeb.com.
  38. ^ For 2006 introduction to Egyptian market, see Chery enters Egypt as homemade representative Chery Official Site, 2011.01.31
  39. ^ Chinese cars made in Egypt (0'41") CNN's Inside the Middle East blog, November 23, 2009
  40. ^ a b "Venezuela firmly supports Chery". Chery. Oct. 28, 2011. {{cite news}}: Check date values in: |date= (help)
  41. ^ "China's Chery Automobile Names New Agent in Indonesia". Asia Pulse. Rhodes. 2011-12-09.
  42. ^ "Russia: TagAZ Clones a Chery for the Vortex Estina". Edmund's Inside Line. Sep 5, 2008. Retrieved 12/31/2011. {{cite news}}: Check date values in: |accessdate= (help)
  43. ^ "Chery crosses Straits to assemble its A3". chinadaily.com.cn. 2009-06-29. Retrieved 2011-05-10.
  44. ^ "Chery A3 Produced in Taiwan". cheryinternational.com. 2009-08-20. Retrieved 2011-05-10.
  45. ^ Chery Officially Enters Thai Market Chery Official Site, 2008.11.13
  46. ^ "Chery Auto to invest $500 mln in new Turkey plant". Gasgoo.com. 2010-11-07. Retrieved 2011-05-12.
  47. ^ "AvtoZAZ: Partners". Avtozaz.com. Retrieved 2011-05-12.
  48. ^ "Chery becomes China's first automaker with exports of over 500,000". cheryinternational.com. 2011-04-26. Retrieved 2011-05-10. the plants in Uruguay and Indonesia manufacture over 20,000 modified Tiggo, A1 and QQ3 vehicles a year
  49. ^ The Chery Tiggo3 Officially Launched in Uruguay Chery Official Site, 2007.10.14
  50. ^ Ramping up Business in Brazil, Chinese Chery Deeply Exploiting South American Auto Market Chery Official Site, 2009.09.03
  51. ^ "Chery holds ceremony for new Venezuelan factory". Gasgoo.com. 2011-09-01. Retrieved 2012-01-08.
  52. ^ Chery's "Outstanding 4+1" Pattern Exhibits the "Chinese Power" Chery Official Site, 2010.04.23
  53. ^ a b c d e f "Chery, Valeo Join Hands to Develop Automobile Lighting Systems". Chery Inc. Nov 22 2011. Retrieved 01/01/2012. {{cite news}}: Check date values in: |accessdate= and |date= (help)
  54. ^ a b c "About". Chery Australia. Retrieved 01/01/2012. {{cite news}}: Check date values in: |accessdate= (help)
  55. ^ "Visteon to Invest in Subsidiary of Chery Technology, Strengthening Automotive Climate Capabilities in China". Visteon Corp. 22 Aug 2011. Retrieved 01/04/2012. {{cite news}}: Check date values in: |accessdate= (help)
  56. ^ Fiat and Chery Reached an Agreement on Engine Purchase Chery Official Site, 2007.08.05
  57. ^ Chery China Chery Official Site
  58. ^ a b A Deep Analysis on Chery A3 Winning the C-NCAP Five-star Safety Award Chery Official Site, 2009.03.18
  59. ^ For China's oil subsidy (an incentive for the State to encourage use and manufacture of electric cars), see China's fuel subsidy costs the world reuters.com, Wed Jun 4, 2008 8:08am EDT
  60. ^ a b Chery-Quantum to Start Building Cars in Changshu, Jiangsu in 2012 chinaautoweb.com, September 6, 2010
  61. ^ "Better Place in China deal". Ft.com. 2010-04-26. Retrieved 2010-06-27.
  62. ^ "Chery Auto and Magna Developing Cars For Europe". motoren.wordpress.com. 2011-09-27. Retrieved 2011-09-27.
  63. ^ Chery S18 Is Off Line, Achieving Zero Emission and Zero Pollution Chery Official Site, 2009.03.18
  64. ^ "Chery wins three awards including "Influential EV Manufacturer of the Year"". Chery Inc. Dec 31, 2011. Retrieved 12/31/2011. {{cite news}}: Check date values in: |accessdate= (help)
  65. ^ For A5ISG hybrid, see A5ISG Overview Chery Official Site
  66. ^ Crash Course in Quality for Chinese Car wsj.com, AUGUST 8, 2007
  67. ^ 2009 First Family Car, Chery A3 Hatchback Launched Chery Official Site, 2009.01.12
  68. ^ 16 New Cars to be Launched in 2009, Chery Implements Multi-brand Strategy Chery Official Site, 2009.02.22
  69. ^ Chery Donated RMB1Million to Establish “China Sand Control Greening Foundation of Chery” Chery Official Site, 2008
  70. ^ Disaster was Ruthless but People were Not: Chery’s Accumulate Donation Amounting RMB24 Million Chery Official Site, 2008
  71. ^ Goodman, Peter S. (2005-06-04). "China a Weak Ally on Piracy". The Washington Post.
  72. ^ a b c "Lawsuits". China Motor Vehicle Documentation Centre. Retrieved 2011-03-12.
  73. ^ a b "China to Foreign Automakers: Drop Dead". Frank Williams. 2007-08-16. Retrieved 2007-12-17.
  74. ^ "Designed in Italy, Engineered in China". cardesignnews.com. 2010-08-09. Retrieved 2011-10-29.
  75. ^ "Один к одному?" (in Russian). Autoreview.ru. Retrieved 2011-06-10.
  76. ^ Ash (2011-04-25). "Chery Eastar unveiled in Shanghai". China Car Times. Retrieved 2012-01-07.
  77. ^ a b c "Chery even used a camouflaged Matiz car to pass auto tests to acquire authorization from the government over production and sales of QQ". Chinadaily.com.cn. 2005-05-09. Retrieved 2010-10-05.
  78. ^ Entrepreneur Bricklin sues Chery over failed deal reuters.com, Mon Jul 21, 2008 1:30pm EDT
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