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SAIC MAXUS’s high spirited growth

SAIC MAXUS held its quarterly dealership conference in Harbin, Heilongjiang Province on August 7. About two dozen dealers attended the conference.

Sales of the company’s high-end MPV and light bus range in the first seven months already surpassed the whole year sales of last year, occupying 10.9 percent of the market share. Ninety percent of the dealers have made a profit.

The day after the conference, SAIC MAXUS launched its first large scale promotion since its establishment three years ago, aiming to double sales from last year.

“Autumn is a season of harvesting,” said Lan Qingsong, president of SAIC Motor Commercial Vehicle Co., Ltd. (SMCV).

The company also released a product plan for the next three years focused on new energy vehicles, pickups and SUVS.

At the 2014 Beijing Auto Show, the company displayed a range-extended hybrid light bus model. It also plans to launch a pure electric vehicle in October and improve existing range-extended hybrid models as new energy light buses will receive subsidies in government encouragement policies and new energy vehicles that meet China’s Corporate Average Fuel Consumption (CAFC) standards will also receive financial subsidies.

According to information released at the dealer conference, the pure electric bus model has a range of up to 150 km on a single charge and will target the government, corporate and urban leasing as well as urban logistics markets. It is expected to occupy 20 percent of market share in the segment and be exported to overseas market.

The pickup truck model, to be released in 2017, is currently in the early stages of development. The Euro VI emissions standards-compliant product can be equipped with gasoline or diesel engines, manual or automatic transmission, and two or four wheel drive.

In 2013, China sold about 400,000 pickup trucks. Worldwide sales of pickups were about 3 million units.

The pickup truck will be a major vehicle type for MAXUS to open up the international market, and a key product to drive up proportion of overseas sales to about 30-40 percent of its total sales. MAXUS has deployed overseas service networks in 12 of the 20 largest pickup truck markets in the world.

The new SUV range will share the development platform of the pickup truck and aims to fill a blank in the SUV segment. To be released in 2017, the seven-seat large body-on-frame SUV has a length of 4,950 mm.

The SUV market is the fastest growing vehicle segment in China, but over 90 percent of the market is city SUVs. Annual sales of body-on-frame SUVs are about 250,000 units, accounting for about 7 percent of the market.

Great Wall’s body-on-frame SUV model, the Haval H5, retails for about ¥150,000 ($25,000), while similar imported and joint venture products sell for about ¥400,000. The new SUV from MAXUS will try to fill the gap between these two price ranges.

In the future, MAXUS will have its pickup truck and V80 in the traditional commercial vehicle market, and G10 and SUV in market for business and private use.

MAXUS has an ambitious target of selling 200,000 vehicles in 2020. Considering the performance of this relatively newcomer, it looks like that goal will not be too difficult to realize.

(Rewritten by Mandy Li based on author’s article published in Auto Business Review)

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