The Riich Z5 will come with a 2.0TCI engine, which translates into quite the little power plant for the Z5. The 2.0TCI engine is capable of 125Kw of power at 5500rpm and torque translates to 225Nm/1900rpm. However it seems that the Z5 will be coming in automatic form, which means some power is lost and ends up with 116kw of power but a torque increase to 250Nm thanks to the 5 speed automatic gearbox Chery plan on using.

Eventual pricing, or a launch date, has not yet been announced, but it is expected to be over 200,000rmb.

Initial engine offerings are likely to be a 2WD 1.6DVVT engine from Chery’s own ATECO range, and is shared with the 2011 Chery A3 model. The engine produces 126bhp of power and has a max torque of 160NM.

The Karry brand has so far sprouted five models, four mini bread vans (You Pai, You You, You Sheng, You Ya), and a sedan box van (the You Yi), the You You (Here You being pronounced as the same as Yo!). The You You is the first to get the one liter diesel power plant that will be popular with frugal rural buyers, that 1.0L diesel engine is from Chery’s own ATECO engine and is the first time that Chery has put such a small diesel engine into mass production. Maximum power from the compact unit is 46kw (63bhp) and has a max torque of 125nm.

Now for the best part – the basic model of the 1.0L diesel Karry You You will start at just 46,900rmb – which is great for a small, powerful 8 seater vehicle, and at the same time the You You is able to receive a 10% government subsidy for rural buyers, and due to its clean emissions it will also receive a further 3000rmb subsidy from the government who are keen to promote a next generation of clean cars. Are there any reasons not to buy one?

Chery appear to be developing another hatchback small car and judging by the spy pictures it looks to be derived from the Chery A3 platform. On the engine front, it is likely to be carrying a 1.3l to 2.0l engine, but it would be wise to remember that Chery are investing heavily in turbo and super charged engines in 2010 in partnership with Easton, so it could be carrying a 1.3S, 1.6S, or 1.8Supercharged engine. Chery are also working towards producing their own CVT gearbox engines, although the spy pics show a manual box, any future model is likely to be offering a CVT automatic to consumers.

Chery 800cc engine

Chery’s first 800cc engine was put into the lowest model of the Chery QQ, the 800cc engine was good for 52bhp which was enough to punt the little mini car around town in a relatively dignified manner.

Chery have now produced a second generation model of the 800cc engine which is promising improved power and improved economy around town thanks to improved DVVT technology. Torque has been improved to 85Nm, whilst the previous generation was 78Nm.

Chery have been one of the strongest proponents of self developed engine technology and have been developing their own engines since they first set up Chery. Their first engine plant was taken from Ford Europe’s Dagenham plant in the UK, which made the Ford Escort engine. Chery dismantled and reassembled this plant in Wuhu China and put the 1.6 petrol engine into production for the Seat Toledo model they produced under the Fulwin name. Chery later set up its own engine division, ATECO, which went on to supply Fiat and several other manufacturers with engines.

Naysayers that said the Riich brand was pretty much a do-do might have egg on their face when they realise that the Riich brand is actually doing quite well. In the first half of 2010, Riich vehicles sold 25,000 vehicles, although they are aiming for a sales target of 80,000 units this year so Chery are expected to give the Riich brand a major push in the second half; still not bad for a brand that was virtually unknown at the beginning of the year.

The G3 will be competing against the Roewe 350 when it comes out with its 1.5T engine later this year, thus Chery are aiming to fight on the luxury side of the Riich brand. Compared to the launch car at the Beijing Auto Show earlier this year, the Riich G3 remains quite true to its original form, except that the Riich badge has moved from the hood to the grill.

Engines are expected to be a 1.3T that was developed in partnership with turbo specialists, Easton, and also a 1.8L naturally aspirated unit from Chery’s own ATECO range is expected to make an appearence.

The facelift Tiggo3 appears to have taken on a much more mature, and slightly more European design style that was lacking from the original RAV4 clone. The Tiggo3 has already been on the market for 5 years with no major design updates, but has continued to sell well, the facelift Tiggo3 complete with a range of turbo and even supercharge small displacement engines is likely to continue the drive into the SUV top sales charts over the next 12 to 24 months, with strong competition expected from Geely’s forthcoming SUV, the Tiggo needs to look good and perform good.

The A3CC owes its sexy design to the Italian design house Bertone, who Chery have kept busy over the past few years with various requests for new designs. The A6CC will launch at the end of this year according to media sources, however it is likely to loose its Chery markings in favor of Chery’s latest brand, Riich, which is an upmarket brand for all of Chery’s latest cars, thus making the A3CC the Z5 which of course has nothing to do with BMW, Chery also called their flagship SUV an X5.

On the power front, the A3CC, or rather the Riich Z5 will be getting a 2.0T box and a 1.8T box from the G-series of sedans.

Update: The A3CC and the A6CC are two different vehicles. Whilst the A6CC has the solid roof, it is actually the A3CC that is a hard top cabriolet. Thanks to HK for pointing it out via the contact form.

The big winner in the government procurement lists have ultimately been the VAG group, their Audi A6 and VW Passat models have been major favorites of all levels of government for the past few years, but recently the Chinese government announced that it would spend more of its money on home grown vehicles rather than imported or JV models. The Riich G6 is expected to combat the Passat and the A4 in the government procurement lists, armed with a 1.8T engine that was developed in house by Chery and mated to a 5 speed semi automatic gearbox it will be well positioned.

From the spy pictures it appears that the production G3 has undergone some minor changes from concept to production car, namely the Riich logo has moved from the hood and has become inter-twined with the grill which makes it look much improved.

The G3 will be one of Chery’s first small displacement turbo engines and will be rocking a 1.3T engine capable of producing 180Nm of torque and 93kw of power, making it quite a potent little package when it launches later this year.

The new van seems to have taken on some Japanese style somewhere in the design stage which has given it an unusual bulge in the headroom department.

Unusual bulges are nothing new to the bread van market, the Chery V2 version had its own strange growth for a while, until it was sent over to the Karry line up.

The Chinese bread vans are usually 7 to 8 seaters and used to ferry people, goods, and just about anything else around town and country with their tiny over worked 800cc to 1.1L engines struggling along.

May 19, 2010 (China Knowledge) – Chery Automobile Co Ltd, the largest domestic car maker in China, Tuesday started constructing an equipment production base in Dongsheng District in Ordos, a city in the southwestern part of Inner Mongolia Autonomous Region.

The base will cost RMB 20 billion. The project is scheduled to be completed during the 12th Five-Year Plan.

The project will produce 300,000 sport-utility vehicles, pickups, commercial vehicles and modified cars, according to Chery.

Chery is also building a base in Dalian, Liaoning Province to produce passenger cars and already makes minivans at its base in Kaifeng, Henan Province.

Ordos accounts for more than 20% of the country’s SUV and pickup market.

Whilst we must congratulate Chery for building a new factory, we do doubt that Ordos counts for 20% of China’s pick up market, otherwise they must have several thousand SUV’s in April, as total SUV sales for the whole of China was nearly 13,000 vehicles.

MINSK, Belarus — China’s Chery Automobile is planning to establish joint production of its cars in the territory of Belarus. It is expected that most of the funds for the project will be provided by the Chinese government as part of a $1 billion loan agreed on by China and Belarus earlier this year.

Chery has been looking for an opportunity to set up production of its low-priced cars in the CIS (Commonwealth of Independent States) countries for the past several years due to traditionally high demand for them in the former Soviet countries.

Production could be launched at the Orsha Aircraft Repair Plant or the Minsk Automobile Plant (MAP). Planned volumes have not been announced.

Chery’s previous attempts at cooperative ventures with Russian companies Avtotor and TagAZ did not meet with success. Two years ago Chery terminated its agreement with Avtotor because it could not obtain concessions for duty-free imports of auto components in the Kaliningrad economic zone. Later, because of huge losses, the Chinese company stopped production at the Taganrog car factory of TagAZ.

Last year, Chery came close to an agreement with the Belarus government to produce its cars at MAZ. The Chinese company planned to start full-scale production, including stamping, welding and painting. The total costs of the project were estimated at approximately $260 million. However, the project was suspended due to disagreements between the sides.

Chery has long been using the Red Army tactic of occupying the countryside to take the cities, which when you change countryside to Eastern Europe and South America and change cities to Western Europe and North America you will see that Chery are developing a very smart game plan indeed.

Chinese carmaker Chery Auto expects its vehicle sales in Malaysia to more than double to over 5,000 units, as the company’s brand awareness is spreading among the Southeast Asian country’s consumers, Search-Autoparts.com reported.Last year, Chery Auto sold more than 2,000 cars in Malaysia, ranking the company 13th in the nation in terms of annual auto sales, up from 19th place in 2008, according to Tao Meng, CEO of Chery Alado Malaysia, Chery’s local joint venture with Alado.Chery has recently introduced its new Eastar 2.0L, a 7-seater MPV, to replace the Eastar 2.4L MPV model that was no longer produced. The new MPV model is equipped with Chery’s proprietary and more powerful ACTECO2.0L engine that is low in fuel consumption.The Chery Eastar 2.0L has a competitive pricing that starts at $23,500. The Eastar models are widely preferred among consumers in Malaysia, and Chery is also marketing the Tiggo SUV and A520 models in this market.Currently, Chery Auto has more than 50 direct-sales outlets and franchised dealerships with a nationwide service network in Malaysia.

This time Chery is aiming to double its sales in Malaysia, a market that is has only just entered and faces fierce domestic competition from the local powerhouse Proton. Will Malays play that patriotic card and go for a Proton, or will they pick the Chery?

The Riich M2 is obviously aimed at being a 2 door city car with seating for just two. A future electric version is reportedly being planned by Chery, as one was on show at the Beijing Auto Show. The future price of the Riich M2 is currently unknown, but it could be one of China’s cheapest cars as the five door BYD F0 starts at 34,000rmb, where as the Chang’an Ben Ben Mini is set to start at 29,000rmb.

Whilst the Beijing Auto Show is in full swing, these photos of a facelift Tiggo emerged from Chery’s hometown in Wuhu, and show a vastly improved Tiggo. The new front end is similar to a VW Tiguan, with slanted front lights and a much more sharper front grill. The interior also has undergone a major change with it becoming more modern and less detached from the rest of the car, the current generation Chery Tiggo interior is very bland in comparison to this. Interestingly enough, this Chery Tiggo is likely to make full use of a 1.6 supercharged engine that was developed by Chery and Easton (more on this next week). An eventual launch date for the facelift Tiggo has yet to be announced, but we are likely to see it towards the end of the year at the Guangzhou Auto Show.

Astute readers will remember that a small Chevrolet MPV was once spotted out testing in China, although since then we have not heard from it again.

The CVT gearbox is suitable for vehicles with displacements from 1.6 to 2.0L, and is expected to reach production levels of 50,000 vehicles per year, and the second stage will see production increased to 150,000 units per year.

Chery started development on CVT gearboxes in 2003, and is expected to become a major supplier of CVT gearboxes to the Chinese auto industry within the next few years, although they are likely to have stiff competition from Shengrui and their 8 speed unit.

The QQ has had some serious changes to its front lights which make it look a lot more like the Riich M1 hatchback and also the rear end has been given a nip and tuck of the surgeons knife to bring it into 2010. See more at the Beijing Auto Show next week!

Chery Shooting Sport Concept

A few years ago Chery wowed the world with its Shooting Brake concept car which was on show at the 2007 Shanghai Auto Show, this concept then disappeared from the public eye until yesterday when spy shots of a Chery model out road testing were posted onto the internet. The car is codenamed A01 within Chery, alongside A01A, and A01B and A101D which are set to be a three door hatch, a four door sedan, and a three door sports hatch. The below car clearly has some Chery A3 DNA in its design styling, which is probably what will ultimately make it so attractive to consumers.

Engine power will come from the second generation of ATECO engines, (The Chery A3 uses the first gen model) which range from 1.0L to 2.0L models and range from 1.3DVVT, 1.5DVVT, 1.6DVVT and 1.8DVVT which all have increased fuel economy and more power. There is also room within the Shooting Sport for a 2.0TGDI engine which might take Chery down an unusual diesel hot hatch route, but this would no doubt appeal to European tastes.

An eventual launch date has not yet been mentioned, but it’s not likely to be 2010 due to the magnitude of new cars that Chery have planned for this year, the Shooting Brake is more than likely to be a 2011 model car for the up and coming automotive player.

At this years Beijing Auto Show, Chery will display 29 new cars and models.

The Riich brand was supposed to be Chery’s shot at an upmarket brand, and will share its showrooms with the likes of the stupidly fast Riich G5 saloon.

The most interesting thing about the M5 is that it is actually a hatchback. The interior appears to be fairly standard for a car that will cost around 30,000rmb to 45,000rmb. However, what is happening at Chery? It appears that there are multiple factions within the company that intent on dragging the brand in ten different directions all at the same time and without a common purpose. If the Riich brand is the upmarket brand, why put the M5 in there, or why even produce it in the first place?

Still, it’s good news for Peugeot as their 207 sedan is now officially the second ugliest car in China after the Riich M5.

Not many car manufacturers in China have made it into the two million car production figure, the first to make it was VW in June 2002, followed by FAW-VW in July, GM made it in 2008, and Guangzhou Honda made it this month. For Chery to join this special club so early is quite remarkable.

Riich and Reely are Chery’s two new brands which they expect to sell abroad. Chery’s current overseas activities include 15 overseas factories which have produced a combined 370,800 cars in the past few years. Chery aims to increase this no with a range of new vehicles. However, in overseas sales Chery appears to be the best selling Chinese car brands.

Information about the car is still slim on the ground, but it is likely to get a showing at the Beijing Auto Show later next month.

Chery’s small car line up currently consists of the Chery Fulwin (hatch and sedan), the Chery A1, the QQme, QQ3, QQ6, and of course the Riich M1, Riich X1 series of cars, so that is eight small cars all fighting for space in the Chery showrooms.

The Fulwin hatch will have 1.5 ATECO engines from Chery’s own engine stable with the options of manual and an automatic gearbox.

Pricing is expected to start at a reasonable 159,800rmb for the base 2.0TCI version. Its the first time that this engine has been used in an SUV, whilst not being an absolute beast of an engine it can push out 235Nm of torque and 146kW of power which will be enough for most inner city jaunts and the occasional light offroading. A turbo diesel version is also planning to launch.

As with the A3 series, the A3CC was also designed by the famed Pininfarina of Italy. The real reasoning for employing an established design company such as Pininfarina is that Chery plan on selling this car in the European and North American markets where the aesthetic design of a car is paramount. The Chinese coupe market is also a small niche that has not yet been entered, but to enter it fully then Chery had to get the car just right, it had to be fast enough to satisfy the speed requirements, and it had to handle, and above all else it had to be comfortable enough to drive on a daily basis. These factors were probably quite difficult for Chery to achieve, but the biggest issue was the folding solid roof. The folding roof issue lead Chery to delay the project for a whole year, and finally in early 2008 they had the break through that they had been waiting for, and by autumn 2008 the first production test vehicle came off the production line.

In 2009 Chery produced three groups of M14 test cars, each group was made up of 5 cars that were sent out to test a different series of roads. M14 was always a code name but during the testing phase Chery came up with the name ‘A3CC’. The A3CC was aiming for a mid 2010 launch, but due to the roof issue the launch has been delayed to the end of 2010, but with winter not being a great time to launch a soft top car its likely the A3CC will be delayed yet again until early 2011.

The A3CC is a front engined front wheel drive car, which makes up the basic elements of most fun little cars. The exterior of the A3CC is quite striking, and will no doubt be popular where ever it launches. Engines for the A3CC are expected to be a the choice of a naturally aspirated 2.0 and a turbo charged 2.0 model, both will have the options of a 6 speed manual and a 5 speed automatic gearbox. Eventual pricing is rumored to be set at 150,000rmb to 160,000rmb, but it is likely that it will be closer to 200,000rmb due to the roof technology and the novelty of such a vehicle. When the Brilliance Coupe launched the flagship model cost 170,000rmb, so it is likely that the A3CC will be priced higher.

Chery have plans to launch an impressive 17 new models in 2010 spread across their 4 sub brands, the M14 coupe, and Riich G3, Riich G6, as well as Reely X3 and X5 models are set to launch. New versions of Chery’s CVT gearbox are also set to launch later this year which will give Chery a boost in the technological department. The soon to be launched Riich G3 is going to be a compact sedan with the choice of 1.6L, 1.8L and 2.0L CVVT engines

Chery also has 9 new engines for 2010, which are a mixture of diesel and gasoline models, which could mean their supposed European expansion is on course for 2010.

On the new energy front, Chery are planning improve their ISG technology, and also plug in hybrid and pure electric technology, all three are expected to reach the mass production stage.
Chery are planning to invest 240 million RMB in R&D in 2010, whilst 2010 income is expected to reach 5 billion RMB. Chery are still working on their new R&D tech center which will be the largest of its kind in Asia when completed later this year, and will mostly focus on developing and designing ‘tomorrows cars’

Although it is lacking the flagships turbo, what it does have is some fuel saving variable valve technology, and a fairly decent specification which will see it compete fairly well against other Chinese mid size sedans such as the Roewe 550.

The 2.0 engine is from Chery’s own ATECO line up and is also upto Euro5 standard. Chery are hoping to take their Riich models to certain European countries within the next 12 months, so it is vital that they can produce an environmentally friendly car, as well as it being safe and sporty at the same time.

Engines for the X5 at launch are expected to be a mixture of self developed gasoline and diesel engines, Chery are expected to offer a Dakar version of the X5.

Whilst the X5 is not exactly a looker, it could be compared to the first generation Kia Sorento, which also was not a looker but was a fantastic offroader. The X5 is also expected to be quite the competant mud plugger with it being capable of going into 600mm of water, and being able to go up 60% degree slopes.

Apparently this is set to be a future Riich vehicle, and is basically a cut down version of the current Riich M1 mini car. This model works out to be 32cm shorter than its big brother, the Riich M1, and will also carry the same engine such as the 1.3L ATECO engine and also a 1.0L ATECO engine, apparently AMT transmission is also in the works for this car.

A final launch date has not yet been announced, but an airing at the Beijing Auto Show in April is more than likely.

Chery appears to be getting closer to a final production car with a lot of engine and suspension set up from Lotus, and a lot of testing in both the UK and in China.

Chinese media reports say that the M14 is more than likely to make an appearance in 2010, although we have been waiting for this car since 2008. Now the question remains, will it become a Chery, or will it fall into the Riich brand which is now Chery’s own luxury label.

Engines for the car are expected to be a 3.0L V6, and also a 2.0T model that is taken from the Riich G5.

The first model to come down the line is carrying Chery’s home built 2.0T engine. The G5 measures an impressive (LxWxH) 4717/1794/1473 and has a wheel base of 2700mm. Chery is reportedly aiming this car squarely at the Honda Accord, Toyota Camry, and Hyundai Sonata with a high class product, but undermining them in price as the above mentioned cars are in the 200,000rmb and rising price segment.

The 2.0T engine from Chery’s ATECO line up is no slouch, it is capable of producing 125kw/170bhp, and 235Nm of torque at 1900rpm. This is Chery’s first turbo engine to make it to production, and it appears to be getting off to a good start judging by the statistics.

Pricing is from 142,800rmb for the 2.0T 6 speed manual, 156,800rmb for the 6 speed manual elite model, and the luxury 5 speed auto will come in at 179.800rmb.

Chery Chairman, Mr. Yin Tong Yue

In a recent interview between auto.sohu and Chery chairman Mr. Yin Tong Yue, Mr Yi expressed that Chery are still resolute on their plans to go it alone and wont sign any JV’s with foreign manufacturers. The interview is very interesting as it gives more information on what goes on behind the scenes at Chery Automobile, and how the company strong man takes on ideas and uses them within the company he has been tasked to manage.

The interview managed to grab headline news across international news sites yesterday, but there doesn’t seem to be an accurate translation of the full interview available, until now:

Auto.sohu (AS): What do you think of the expansion in this years car market?

Yin Tong Yue (YIT): Originally we were pretty optimistic with regards to 2009 sales, but as the government introduced new policies which liberated the market in a certain way. So, nobody really expected the market to hit 13 million cars this year but by end of November we were already at 12.26 million cars and every manufacturer is at full production capacity, the market is really good. The market is developing much faster than what we expected, so first of all we need to thank the government for their support of hte industry, secondly we need to thank low oil prices for making it possible to create such an excellent car market. The Chinese car market did not feel any effects of the economic crisis in 2009, other industries had a difficult time whilst the car market is just on fire.

AS: Many believe that the market this year is all thanks to the supportive policies of the government, but the most important aspect is that market demands have been liberated, what do you think of this?

YIT: I believe that car buyers have reached the consuming age, the car industry has reached the R direct calculation (R值的计算) age, previously only 70′s Japanese cars, and 80′s Korean cars reached this stage, Chinese are around 30 years late into this game.  (We think he is referring to the stage at which personal buyers started buying cars for family use)

AS: Now the industry has a lot of speculation, how long do you think the Chinese car industry can continue to develop at such a high speed?

YIT: After growth, there will always be a fall, the country does not allow for continued explosive growth like we have seen this year. One reason is due to the traffic situation, another is oil consumption, and another is the environment. Perhaps the government will restrict the development of large displacement traditional cars, perhaps we will see a new round of automotive policies from the central government with regards to high oil prices, and the registration of vehicles within city limits.

But the basic demands of our country are great, we have many cities, we also have small towns and villages, these are large markets. Farmers incomes are increasing, in recent years national policies have been favorable towards villages, which has increased farmers needs. Another issue is that the quality of roads in rural areas is improving all the times, which gives us yet another market to enter.

AS: With market growth so large this year, what kind of effect has it had on Chinese self developed vehicles, will we see any changes, and what kind of chances or risks are self developed vehicle companies facing?

YIT: This type of fast paced market expansion is good for domestic Chinese brands, its a great chance, the market is big and encompasses first tier to second and third tier and even fourth tier cities. Each tier is different, they have different expectations and needs of each brand and product, basically the market is huge.

A problem that domestic brands face is that the market is too good, other manufacturers might rush into expanding production to meet initial needs, but then overlook R&D. Because of the competition, we need to rely on our brands, which in turn rely on technology. Many companies are now ignoring their R&D requirements, and aren’t investing enough in their brands, they chase factory expansion and adding new factories, as soon as the market stumbles they will hit a major bump in the road.

AS: Speaking of brand building, this biggest event for Chery this year was launching four new brands, now after half a year after their release, have the models for each brand been succesfully launched?

YIT: Building a brand takes a long time, and it is difficult. This year Chery split the market into different brands, and gave each brand its own segment to compete in, this way the brands are much clearer, and the Chery brand isnt dilluted across many different segments. To many other countries, China is not just a country, its a world in itself with a massive population, with a huge economy that increases with great pace, the needs of our consumers vary a great deall and thus have different requirements and expectations from each brand, so we introduced the new sub brands.

The launch of the brands went better than we expected, using this method to position our brands we’re able to divide the market clearly, and our branding is much easier to understand.

The Riich line up is pretty much stable now, we’re aiming for sales of 8000 units this month (December) however, we know that January 2010 will easily clear 10,000 units.The Karry brand, as it is for a mini vehicle range, is expected to sell 7,000 to 8,000 units this month, in January we also expect it to sell over 10,000 cars. As the Chery brand has been around for a long time it sells the best, this month we expect sales of 43,000 units in China, but including international sales we can expect 67-68,000 sales this month, but January we will sell 70,000 units.

AS: With 2010 practically upon us, and after so much brand restructuring this year, and we will be entering a year of stable development in the car industry, what can we expect from Chery?

YIT: We should say that Chinese brands are two types, the first type is joint venture brands and these are more numorous in China especially with premium brands, self developed brands have come from having a zero percent market share to about 30%, joint ventures account for about 70% of the market. Self developed vehicles have improved a lot, we hope that our Riich brand can enter the global market and become a global player alongside global competitors, we also manage Riich like it is a global company.
Take for example our Riich X5, on Jan 1st it will take part in the Dakar rally, eveyrbody knows this is a difficult race. This year our Riich G5 went on the Nürburgring and did a lap in 8 minutes 56 seconds. Compared to other cars that have been around the ‘ring, this is a great result, that track is 23km long and has 177 hard corners, which puts a lot of stress on the platform, brakes, and handling. Now Riich is ready to become a global player, we’re ready to cast of the low price tag and compete on quality, value, technology, and branding. Chery has around 6000 engineers working in our R&D department, we apply for nearly 2000 patents per year, we’re working hard on traditional automotive technology and also new energy source cars.

AS: Whilst we’re talking about brand expansion, can we understand that Chery is looking for larger numbers, has Chery raised the bar or are you looking at other changes?

YIT: Chery was started in 1997, we went down a different road from other car companies, we’re always different from others. Other people are looking for joint ventures, but we’re determined to go down the road of self development, at the time many people said that this plan was impossible and making cars requires scope, when others were aiming to build 300,000 cars at that time were just aiming for a few thousand.
Secondly, at that time how could we do R&D? To do R&D you need to sell hundreds of thousands of cars, we didn’t follow the road here, eventually we did receive government approval to start building cars. By 2008, we had plans to build one million cars per year, but we knew it wasn’t wise to do this, we worked on our QQ and Fulwin models to enter the market, eventually we controlled our own rhythm. We need to work more on our brands, our research, and undergo some globalization. We need to control our models, and the speed at which they hit the market, and to control our development, whilst speeding up our internal internationalization.

2007 and 2008 were slow years for us, in fact, we lost a little bit of market share. 2007 sales were at 380,000, 2008 sales were at 350,6000 many people were saying Chery were no good, in fact we are on our road now, we think that this is the best way, so we launched new brands. Previously we would average sales of around 30,000 units per month, now we averaging 70,000 units per month, we should say that in China, the self developed brands are the strongest.

So, car market competitiveness isnt just about speed, and not only is it about scope, the most important is to have your own ability. Countries are the same, countries dont care about size, take Israel for example, it is small, but powerful. I hope that the car industry can become more powerful, as long as you have this power, then your brand can become stronger.

AS: What is your R&D like, where would you consider yourself against other companies?

YIT: As I mentioned earlier, we have around 6000 R&D staff and engineers, many of them have studied abroad, and we also have some foreign engineers working for us. China is hot right now, other countries are just a sea of financial difficulty, so we have a lot of talent to choose from, such as foreign companies, we can use the worlds best resources, and they are cheap too because they are doing badly overseas, finding a job is difficult but they are willing to join us. Some of our engineers are learning German, because we have a lot of German engineers now.

AS: Many people might call into question Chery’s brand strategy, some people are also wondering when Chinese cars will break into the premium segment, is it becoming fashionable to compare Chery to multinationals?

YIT: Chery has always been like this; if we say we will do something, and everyone agrees, then we wont do it. From the start of something we always receive criticism. So when everyone was chasing JV’s, we went down our self development route, when everyone was into R&D, we were into branding, building our brands and carrying out market because R&D is a tangible object, when you have enough tangible objects you can start work on virtual objects such as marketing.

AS: I saw last months Peoples Daily Newspaper had article about the rough drafts for speeches that you have made entitled ‘Early to modify, early to act upon‘ You carried out some modifications in your brand structure, and product structure, have you seen any gains since then?

YIT: Actually, competition is only half the issue, one part is differentation, another part is to lead the crowd by half a step. So we previously put more money into R&D, into self development, so our technology was higher than everyone elses at an earlier stage, when everyone was working on injection systems, we were working on multi stage combustion engines. When everyone was working on manual gearboxes, we were working on our own automatic gearboxes, we’ve broken a lot stereotypes, we’re working to tell our consumers about our technological break throughs, we want to raise our quality and our organisation.

We dont want to fight in a price war anymore, we want to take our products into the JV arena, 70% of the market is foreign brands, we want to compete in the 100,000rmb to 150,000rmb sector, and even higher price brackets. The facts prove it, all you need is a really good product and the market will accept it, so on this aspect we feel that branding is difficult, however it is not as mysterious as we thought.

China has been through 30 years of development, in the end we are talking about resources, material processing, to prices wars, development over the next 30 years should rely on technology, on our brands, and on the quality of our products to amplify our competitiveness.

AS: Which of Chery’s brands are capable of taking on the joint ventures?

YIT: Of course our products are improving with every generation, take for example our Chery A3. We used global cars as a benchmark for the A3, at 4.3m long the car is small, but upto five star design standards, it looks great, and the market has accepted it in a fantastic way. Buyers arent in the impression that self developed Chinese vehicles are low price goods, actually consumers are smart, they have the ability to think for themselves. And then there is the recently launched Fulwin2 which is greater than our expectations, we sold around 10,000 since its launch, this month we’ve sold about 6000 of them, its accounting for about 20% of our sales so far. Next month we will sell around 10,000 of them.

AS: Chery is very active all over China now, in October you opened a factory in Dalian.

YIT: Thats right.This year Chery is looking for sales of around 500,000 units, plus we’re exporting a lot more now, last year we accounted for about half the sales in China for self developed cars, this year there is no doubt we will be first again, however we want to improve the sales ratio! Now we have 16 overseas factories, with full car exports to over 70 countries and territories, which are either imported or assembled in their respective sales countries. Chery is based on teh Changjiang river, but there are many bridges that boats cant go down, so it makes our products go by road which makes the cost higher, our Dalian factory is close to a beautiful port where boats of upto 60,000tones to 100,000 tones can stop and load. We’ve turned the Dalian factory into our export factory, anything made there will be sent overseas. China is now a large market, and the worlds largest product maker and soon to be the worlds largest exporter, we hope that Dalian will become part of our export net, and will help us enter the global market. We also have a factory in Kaifeng in Henan province where there is a large market in inland China but a relatively low car producing market.

AS: What other plans do you have for China?
YIT: First we will deal with Henan and Dalian, but our home will always be in Wuhu.

AS: You just mentioned the overseas market, and you plan to have 16 foreign factories.
YIT: Some of these factories are what we partially have stocks in, others were have controlling stocks. We give our partners conditions before starting collobaration, because each market is a different situation, we dont just hope to sell cars, we want to introduce the car building industry into each country and take some employment oppertunities.

AS: We’ve heard you’ve bought a Fiat factory in Italy.
YIT: Thats just a rumor, rumors about Chery are many, they told us that we’ve bought a Fiat factory in Sciliy, we don’t have this problem, what the media reports is funny.

AS: You just mentioned the rumors about Chery, such as you’re always looking for a JV partner, are you looking out for a JV partner?

YIT: Previously we’ve thought about buying an established European brand, and also thought about working with foreign companies, JVs, and giving our staff training etc. In the end we discovered that we can do most of this ourself, Chinese have never been able to consume foreign companies without great difficulties, there is great risk involved two. First are priorities are safety, the second is development, so we are not as brave as some other Chinese companies, so you could say we’re a bit more conservative.

AS: Does this not mean that Chery will just be a little bit slower than the rest when it comes to foreign mergers?

YIT: On the basis of principle we refuse to merge. Many people have come to us to sell us over exaggerated cases, investment banks come too, the problem with these banks, is that you get married to them one day, the next day you divorce, this is what investors do, so we refuse them, we wont be cheated.

AS: Could you tell us about your plans for 2010?
YIT: In 2010 we think that sales will still be good, the first quarter will good, the second quarter wont be so bad, but the third and fourth are hard to predict so early in the year. We are also worried that the price of oil will shoot up again, a slight rise in international oil prices has a massive effect on the Chinese market, as soon as it rises, we feel the pressure. Next year we hope that we can continue to grow, this years new products are many with 13 new cars launches and 10 more in the pipelines. The international market is likely to pick up once again, of course this year is not totally over yet and we haven’t had our directors meeting to authorise the launch of new cars, exactly how many cars we will launch we dont know yet.

The news, which was first reported in La Republica newspaper, revealead that Chery are setting themselves up for a major Western European offensive by buying Termini Imerese, a major Fiat production base that is likely to close in the near future.

Later reports have quoted the Chery Chairman, Mr. Yi, as saying “There is no plan of such a sort“, which has left both foreign and media reports unsure as to what exactly is happening. Chery do have small dealings with the Italian car company DR, which sees the Chery Tiggo SUV and Riich M1 hatchback being sold in Italy under the DR brand.

Chery will have 15 oveseas factories by the end of 2009, with the completion of factories which Chery has built with local partners in Argentina, Russia, and Uruguay. Chery is also expected to invest heavily in the Turkish market with a new factory, which could also see models exported into Europe.

The pictures clearly show that the QQ3 Electric (QQ3E) has had its tail pipe removed, and a charging port installed instead, the gearstick is the type that is usually utilised on small electric cars with only drive, reverse, and neutral being available.

The Chinese press are expecting the QQ3 Electric to cost around 50,000rmb when launched, however it could be that the Chery M1 electric hatch will be launched first, the M1 is the first pure electric hatch that Chery will launch and will be placed higher than the QQ3 electric in the Chery line up.

Batteries for the QQ3E are located in the former engine bay, which has apparently been crash tested by Chery, it is believed that Chery are thinking of installing batteries along the underside of the car as well to improve range. The QQ3E has already received a production license from the government, although a launch date has not yet been announced, nor has a price.

The front end seems to have undergone a massive change, but the side and rear look to be the same.

Power is expected to come from a 1.0L engine delivering 80Nm of torque to the front wheels.

Price wise, the QQ3 is still expected to be one of the cheapest model in the Chery line up and will probably retail in the 20,000rmb to 50,000rmb range. A firm launch date has not yet been announced, but you can expect this baby to be on show in Guangzhou this month.