Beijing Jeep to Get a Jump-start This Year

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Last updated at: (Beijing Time) Tuesday, March 18, 2003

Beijing Jeep to Get a Jump-start This Year

Beijing Jeep, a debt-riddled Sino-foreign producer of sport utility vehicles (SUVs), is aiming to double its sales this year, in an effort to jump-start profitability.

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Beijing Jeep, a debt-riddled Sino-foreign producer of sport utility vehicles (SUVs), is aiming to double its sales this year, in an effort to jump-start profitability.

The joint venture, between Beijing Automotive Holdings Corp and DaimlerChrylser AG, plans to sell 20,000 SUVs this year, up from around 10,000 units last year, according to Paul Alcala, the venture's president and chief executive officer.

"We expect to break even this year," Alcala told China Daily.

The company announced that it hopes to earn more than 100 million yuan (US$12 million) next year.

Beijing Jeep, the first Sino-foreign auto joint venture, was forged in 1984 and for years dominated the lucrative Chinese SUV market.

The tide turned in recent years, with a slump in sales triggering huge losses. The decline has been blamed on its outmoded product portfolio and increased competition from new market entrants.

However, the company has unveiled new product plans which it hopes will reverse its decline in fortunes.

"We will deliver at least one new model every year," Alcala said.

Last Friday, the company launched Mitsubishi's Pajero Sport in Beijing.

The 3.0 and 2.4-litre Pajero Sport, the first Mitsubishi SUV to be made in China, will sell for between 219,000 yuan (US$26,460) and 349,000 yuan (US$42,165).

Beijing Jeep will also produce Mitsubishi's Pajero Outlander during the first half of next year under its technical licensing agreement with the Japanese company.

The two SUV models will go head-to-head with imported Toyota Landcruiser and Honda CRVs, along with China-made General Motors Chevrolet Blazer and Nissan Paladin.

Alcala forecast that China's SUV market will hit a minimum of 120,000 units this year, up from around 95,000 last year.

"We will further overhaul our distribution system with the focus on after-sales service," he said.

Beijing Jeep has opened 50 sales, spare parts supply and services facilities across China, according to Alcala.

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