Guangzhou Auto Own Brand Path

http://chinesecarweb.com/content/images/102008/gaig_concept_car_red.jpg Guangzhou Auto, one of the most profitable chinese car maker, is working hard to put into the market its own brand. The current state : Guangzhou Auto exits only through its joint-ventures with Toyota and Honda. Two brands that have knowledgeable success in China (Honda even pushes it one step further by exporting the first ever JV car to export : the Honda Fit (aka Jazz)). Toyota and Honda should bite their fingers right now, as Guangzhou Auto is a serious candidate for a strong chinese car maker.

Japanese management

The staff of Guangzhou Auto maybe accustomed to the stringent production standard of their japanese counterpart, Kaizen, TPM, 5S are only a slice of the quality and productivity tools they learnt so far. But hey wait, where do the staff come from? The JV of course. Not only is GAC becoming a competitor but also it is currently siphoning brains from the JVs. And to speed up the development process, they use a Camry based chassis (one favorite tactic of chinese industrial to catch up their competitors). In our opinion, deriving a chassis from an existing Toyota one doesn't really mean they will have their own car. But in the Chinese's mind it is. In 2006, GAC already set up an R&D center, the engineers were working on the car, the future plant, the production line, suply chain, marketing, went as far as designing after sale services.

the price of independance

The initial investment amounted for 986 millions USD, the products will hit the street by 2010, the initial capacity of the plant is 100 000 vehicles and 100 000 engines, GAC will double the output of vehicles and target 250 000 engines, with no date precision. Surprising is GAC said using Camry based chassis will save them 10 millions yuans, it is barely one millions UDS, which is not that much. The design of the car is made by an italian company, it may worth 20 to 30 miilions yuans.
The GAC own brand is not to be confused with the Linian brand (which concept car was unveiled at the Beijing Auto Show), Linian is a JV brand, owned by Honda and GAC, while this article is talking of a 100% GAC product.