Dongfeng-Nissan joint venture announces ambitious marketing goal

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Last updated at: (Beijing Time) Wednesday, October 01, 2003

Dongfeng-Nissan joint venture announces ambitious marketing goal

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Dongfeng Motor Co. Ltd., a joint venture between Dongfeng Motor Corporation and Nissan Motor Co. Ltd., says it hopes to sell 550,000 automobiles, with sales exceeding 80 billion yuan (about 9.64 billion US dollars), by 2006.

Katsumi Nakamura, president of the joint venture, announced the plans in an interview with Xinhua. He said the joint venture has recently set up a special marketing team.

Dongfeng Motor Co. Ltd. was built with Nissan Motor Co. Ltd pumping in 1.01 billion US dollars, while Dongfeng Motor Corporation, one of China's leading auto makers, staked about 80 percent of its assets. The joint venture began operation on July 1.

Dongfeng Motor Co. Ltd., considered one of the largest joint ventures in the country's automotive industry, has been registered in Wuhan, capital of central China's Hubei Province, with a combined investment of over two billion US dollars.

The joint venture, with 70,000 employees, produces automobiles ranging from cars, trucks, minivans, to buses at three separate bases in Guangzhou, capital of south China's Guangdong Province, and Xiangfan and Shiyan cities, both in Hubei Province.

Nakamura said that the headquarters of Dongfeng Motor Co., Ltd.would also move to Wuhan where it is registered.

The fast growing market has made China an important part of Nissan's global strategy, said Carlos Ghosn, chairman of the boardof Nissan Motor Co. Ltd..

"Out of Nissan Motor's plan of scoring a rise of 1 million units in sales of automobiles in three years, we want the Chinese market to contribute 80,000 units," said Ghosn.

Apart from contributing over 1 billion US dollars to the joint venture, Nissan has decided to spend another 300 million US dollars in developing products catering to Chinese consumers, said Ghosn.

China's automobile market has experienced drastic growth, and 3.4 million automobiles were sold last year alone, up 50 percent from the same period of 2001.

Miao Wei, general manager of Dongfeng Motor Corporation, believed that with the market demand ever growing, automotive multinationals could not always maintain an advantage in the Chinese market simply by relying on a single product as they did in the past, so they resort to expanding investments to forge strategic alliances capable of diversifying their production.

Dongfeng Motor Corporation on Sunday moved its headquarters from the mountainous area of Shiyan City in Hubei Province to the provincial capital of Wuhan, setting itself in a strategic location.

By the end of the last year, Dongfeng's total assets reached 58.1 billion yuan (7 billion US dollars), with net assets standing at 21.7 billion yuan (2.6 billion US dollars) and 117,000 employees.

In the first eight months of this year, the company produced 329,000 motor vehicles, up 17.31 percent from a year before, and sold 321,000 units, up 18.91 percent. Its sales revenue for the eight months increased 17.59 percent to 52.1 billion yuan (6.3 billion US dollars) and profit jumped 28.4 percent to 4.6 billion (554 million US dollars).

In addition to Nissan, Dongfeng Motor Corporation has also entered partnership with Cummins of the United States, Citroen of France, Kia of the Republic of Korea, and Honda of Japan.

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