– by Wayne Xing
Date of Publish: 2011-09-27
The China-on-Wheels fleet of three Chinese-made cars, Dongfeng H30 Cross, JAC Rein and Hawtai B11, left Beijing late Sunday morning heading toward Erdos where Hawtai Motor is based, hoping to avoid the likely traffic jam on the Beijing-Tibet Expressway on any weekday.
No luck.
Starting from the Nanko No. 1 Bridge up to the Juyongguan Great Wall and beyond close to the boarder of Hebei Province, traffic jams are a daily phenomenon. On a strip of 50 km inter-province expressway and local highways, heavy-duty trucks carrying heavy loads of coal were crawling at a snail’s speed, often coming to a standstill due to either accident or a breakdown truck. This reminded us of the famous 10-day, 100 km gridlock in the summer of 2010.
It looked to me that the majority of the 1 million heavy trucks made last year were traveling on the Beijing-Tibet Expressway, connecting the western provinces of Inner Mongolia, Shanxi, Shaanxi, Ningxia and Gansu to the inland via Hebei and Beijing.
China’s economic boom and industrialization relies heavily on a major natural resource: coal. And coal in return has propped up not only the truck and auto industry but also the rise of new cities and new automakers.
The city of Erdos, in particular its Kangbashi New District where Hawtai Motor is based, is a good example.
Erdos in Inner Mongolia is a city described as Yang Mei Tu Qi, meaning in the Chinese idiom “jubilant,” but the individual Chinese character means, respectively, in a pun, wool, coal, rare earth and natural gas. With these natural resources, the per-capita GDP of Erdos not only ranks No. 1 in China but has exceeded that of Hong Kong. Literally the Kangbashi New District, where the Erdos municipal government is now based, has been built in less than 10 years which boasts the world’s largest square of 2.5 km by 200 meters with the “world’s largest music sprinkler system” by the side of the Wulanmulun River.
And the privately-owned Hawtai Motor takes up a major part of Kangbashi, or 6,500 mu (4,333,333 square meters) where it has been assembling CKD Terracan imported from Hyundai, building new workshops to make its new A+ passenger car the B21 and making diesel engines and automatic transmissions. At its Rongcheng, Shandong Province, assembly plant, Hawtai is already making the Santa Fe SUV and its mid-level sedan, the B11.
Hawtai’s OED Engine Co. has an investment of ¥7 billion ($1.07 billion) and already has a capacity of 300,000 diesel engines and 400,000 automatic transmissions. Total capacity of automobiles in its two production bases will soon reach 400,000 units.
Another of China’s local brand, Chery, is also building an assembly plant in Erdos’ Equipment Industrial Park, with a capacity of 300,000 units.
The big question for the two independent vehicle brands is whether the large capacity would be realized in the future now that the country’s automobile market demand is slowing down. And for Erdos, if the prosperity is to continue.