Joint Ventures Essential to Auto Industry Innovation

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　　With profit margins¹ in the Chinese auto² industry continuing to erode³, a number of joint⁴ ventures are looking toward China's less-developed western regions as an area to shore up their bottom lines.

 

　　CRI's Hu Jia has more.

 

　　Vehicle output in the Chengdu Economic Development Zone for the past year has increased 1.4 times from 2011.

 

　　The joint venture carmaker FAW-Volkswagen, one of the forerunners⁵ in developing the region, says, the figure reaffirms their move, to increase the presence in western China.

 

　　FAW-Volkswagen has just completed its 3 year expansion plan, in Chengdu this year, with full capacity ,now approaching, 250 thousand units.

 

　　It means that every minute, there's a brand-new car rolling off, from its Chengdu assembly line.

 

　　Another Fortune Global 500 ,the premier⁶ car interior supplier - Toyota Boshoku is following the trend to extend to this area, now a booming auto part hub.

 

　　It has established a partnership⁷ with First Automobile⁸ Workshop in Chengdu to provide vehicle seats and interior ornaments⁹ to the Japanese auto giants.

 

　　Wang Lixin, deputy manager of the operation department, says that automotive seating assembly is not that easy.

 

　　"Despite vehicle function production, manufacturing seats requires the most technology. Though seats barely look so, they incorporate many sensors¹⁰ inside, you have to meet the accuracy standard　and meanwhile the bar set for fabric¹¹ and textile is also high."

 

　　High strengths laser welding is used in the shaping, of frames and the sliding channel.

 

　　It asks for excellent metal processing technology.

 

　　Though some of the special materials still rely on imports from Japan, Wang says that auto material development here in China is on its way to catching¹² up.

 

　　"Some progress has been made over the development on car materials recently. We're capable of produce more than 70 percent of the parts here in China."

 

　　Another indicator¹³ for the rising of Chengdu's auto industry goes to the boiling-down deal between homegrown carmaker Geely and the Swedish luxury brand Volvo.

 

　　Volvo Cars China has selected Chengdu as the ideal place for its localized plant after being taken over by Geely.

 

　　Now the factory has started manufacturing the flagship model S 60 L here in China.

 

　　Feng Xuhong is deputy general manager of Geely.

 

　　"Volvo is known for its solidarity¹⁴ and reliability¹⁵. Geely will borrow these technology merits from Volvo in developing its future products."

 

　　Volvo Cars will host a roundtable discussion on the future of transportation at the upcoming Fortune Global Forum¹⁶ this Thursday.

 

　　Meanwhile, Li Shufu, founder¹⁷ and CEO of Geely will also show up and is expected to release some decisions on the group's future.

 

　　For CRI, I'm Hu Jia.

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