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Local independent brand is Chinese brand

Zhu Huarong, vice president of Chang’an Automobile Group, recently posted on his Weibo (microblog on sina.com.cn) that the company has begun using Chinese brand (zhongguo pinpai) instead of independent brand (zizhu pinpai). “This will facilitate better international exchange and understanding of Chinese brands,” Zhu writes.

Chang’an’s decision followed the decision in January by the China Association of Automobile Manufacturers (CAAM) to refer independent brands as China brands in its monthly statistical report on output and sales.

For a long time the definition of independent brand has been a topic of debate in the industry even though the most likely meaning is clear: it denotes locally developed Chinese domestic brands instead of foreign brands assembled at joint ventures.

But with the emergence of the so-called “joint venture independent brands” (such as Baojun, Everus, Venucia, etc.), the term “independent” becomes even more confusing. Are these hybrid brands also independent? What about Qoros, a completely new brand made by joint venture in which the foreign partner contributes only capital? What about Volvo, a Scandinavian brand that is now 100 percent owned by Geely?

By using the term Chinese brand, CAAM and Chang’an seems to have chosen the more appropriate and less confusing term for independent brand.

If brands are differentiated by country of origin, such as European, American, Japanese, Korean, etc., then brands originate in China must be Chinese brands. JV brands are therefore foreign brands. JV independent brands can then simply be called Chinese joint venture brands. The definition becomes clearer. Qoros is therefore a Chinese brand but Volvo still a Swedish brand, except that it is owned by the Chinese. This is similar to the Jaguar and Land Rover, which are British brands owned by India’s Tata Group.

Multinational vehicle brands are all “independent” brands even though no one uses the term. But multinational brands assembled in China are made in China. They are not Chinese brands.

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