Geely MK News

Chinese cars were tipped to dominate the budget-car class and challenge established brands in half the time it took Japanese and South Korean companies - but the bubble has burst before it's properly inflated. After some early success since becoming the first Chinese brand to go on sale in Australia, Great Wall Motors has hit reverse and its Chinese peers are struggling to get into first gear.Official figures for the first five months of the year show Great Wall Motors deliveries are down by 35 per cent compared with the same period the previous year in a record market that is up by 4.5 per cent.Other Chinese brands such as Foton have also had a stalled start. After announcing big plans two years ago Foton has sold fewer than 300 pick-ups in that time.Budget brand Geely has still restricted its sales to Western Australia and Chery's small cars have been stymied by newer competition from established brands. Chery sales are also down by 35 per cent.The Chery J1 hatchback was the cheapest car in Australia in almost two decades when it went on sale with a $9990 drive-away price in 2011, and is now available with a "pay half now, half later'' deal.But it too has failed to rock the sales charts. ''Sales have slowed for now but they will recover,'' says Daniel Cotterill, the spokesman for Ateco, distributor of Great Wall Motors and Chery passenger cars and the Foton truck range.''It's been frustrating for us and the dealers to not have more new models available to us as quickly as we would like."'The other challenge for Chinese car brands is that mainstream marques such as Suzuki, Nissan and Volkswagen have all responded with quality cut-price contenders priced from $11,990 to $13,990 drive-away. "In some ways we are a victim of our initial success,'' said Cotterill. "Other mainstream brands have had to come down in price to compete with us.''Other hurdles: more than 20,000 Great Wall Motors and Chery vehicles were recalled in August 2012 for having asbestos components in their engines. Chinese cars tend to earn poor to scores in crash tests (between two and four stars when the modern industry norm is five stars).But the companies hope to have a reversal of fortunes with a number of new generation Chinese vehicles made to international standards due in local showrooms in the next two years.''There are new models in the pipeline,'' said Cotterill.''We are confident in the ability of the Chinese to respond the Australian car market and boost sales.''This reporter is on Twitter: @JoshuaDowling 

Geely’s EC7 sedan, a 1.8-litre sub-$16,000 car that could hit Australian showrooms by September, is the second of the maker’s vehicles to become available in Australia but, says importer John Hughes, the most vital.“This is an important car for us because it comprises all the safety and quality features we demanded,’’ he says, “the EC7 is the result of a lot of hard work - in Australia and China - to bring affordable cars into the country. And I think it’s a fantastic effort, in terms of looks, features, safety and performance.’’But it first needs an acceptable safety rating.  Mr Hughes expects the EC7 to get a minimum of a four-star crash rating by NCAP-standard tests completed early this week in China by Geely.“We’ll take those test results, when they are made available to us, and then offer 10 cars to ANCAP for its own evaluation,’‘ Mr Hughes says, “if they don’t tests them, I’ll pay for testing myself. It is so important that we get this right. Safety is a very high priority for buyers and we want to get the highest level possible within an affordable price range.’’The EC7 will be the first car from Geely’s national distributors John Hughes Group to meet Australia’s car safety standards, including the electronic stability control.John Hughes sells the Geely MK1.5, a small sedan or hatch, in WA only. It does not have ESC as standard and retires from the market at the end of this year.Australia will import two Geely EC7 sedans, all with a 1.8-litre engine, five-speed manual transmission, six airbags, electronic stability control and alloy wheels.The “base’’ model has leather upholstery and a four-speaker audio and the luxury models adds a sunroof, Bluetooth with six speakers, sat-nav, reverse park sensors and an electric driver’s seat. weaThe car has a three-year or 100,000km warranty with a five-year driveline warranty.Mr Gailey says the Geely products meet European emission standards for waterborne paint and have high pedestrian safety scores.The EC7 could be followed by an SUV version. But Australia won’t get the bigger EC8 model because it is not made in right-hand drive.John Hughes and CAD director Rod Gailey joined eight Australian dealers to view the Geely and ZX products at the Shanghai motor show.Geely will provide the importer with its mainstream sedan while rival Chinese company ZX will continue making utes for the Australian market.

The Geely MK 1.5-litre sedan will be the nation's equal cheapest car, matched by the 1.3-litre Proton S16.  A shipload of 100 sedans arrived in Perth this week and go on sale within a fortnight.Australian distributor, Perth-based John Hughes, says the MK will only be sold in WA. The high profile dealer, the state's biggest, has built a new showroom close to the city centre for Geely.He says the MK will only be sold in WA primarily because it currently is the sole Geely product.  "I can't get dealers to commit finances to a new showroom to support one model," he says.  "When other models arrive, then the brand will be available across the country."The second reason for the containment of sales in WA is because the MK doesn't have electronic stability control and won't meet the 2011 vehicle standard of Victoria."But the next Geely model, the Panda LC, will go on sale around the middle of this year as an automatic and with stability control," he says."This will be followed by the bigger 1.8-litre EC7 sedan in the third quarter."The MK is a four-door sedan with only a five-speed manual. Its standard features include a five-year warranty, airconditioning, two airbags, remote central locking, alloy wheels and electric windows.  A second shipment of 100 cars is expected next month.Mr Hughes, who has huge success with his multi-franchise dealerships, was the original distributor and retailer of Hyundai in the mid-1980s. He has frequently been Australia's biggest selling Hyundai dealer by volume, not capita.

The third brand to commit to local sales - after Chery and Great Wall - says it will have its first cars in showrooms by September and aims to sell a minimum of 5000 cars a year within 18 months.But it is taking a low-key approach with the local agent, John Hughes, building a plan around local success in Western Australia before moving to eastern states early in 2011.  "We want to get people to put the cars on their shopping list, even though the cars are made in China and the brand is not recognised," says Hughes.He says a single-car lineup with the Geely MK, a 1.5-litre compact sedan, is not enough to build a dealer network and so he is concentrating on getting things moving in WA.  "We plan to order our first cars in June with sales, in WA only, around September," says Hughes."We have to under-promise and over-deliver, so we would like to start recruiting dealers in the first quarter of next year. We want to establish the brand in WA with our own particular expertise."  Hughes knows all about start-up brands as he was one of the original Hyundai agents in Australia, eventually becoming the world's best selling dealership for the Korean brand.This time he is going along and has a structured approach to the Geely business.  "We are weeks away from getting ADR approval on the MK. The hatchback will be a couple of months behind the sedan, and the automatic will be another couple of months behind that again. But still all the MK model," Hughes says."The next one will be the LC, which is called the Panda in China, and we're talking about the first quarter of next year.  "After that will be the EC7, which is a 1.8-litre car in a hatch and sedan. Then we'll launch East."He says the Geely price approach is similar to the other Chinese companies, sitting at Korean levels with more equipment. It's the same with sales targets.  "The MK is really a pilot, so it will be modest numbers. The Panda will be good, and the EC7 too. We'll get into serious numbers in the second half of 2011."We're looking at around 5000 a year, although we won't necessarily do 5000 in the first year."  Geely makes a giant splash at Auto China 2010 in Beijing with 42 different models on 19 mechanical platforms with 15 different engines.It also has hybrid and plug-in electric cars, as well as big plans to build two million cars a year by 2015.  "Out of those 42 different models, there are 11 targeted at the right- hand drive market," says John Hughes."Whilst Geely are marketing three different brands in the Chinese market - including Emgrand and Englon - we intend to bring any of the products to Australia under the one umbrella, which is Geely."He hopes to get the brand's green cars as soon as they are available but is waiting for confirmation from China.  "We have seen the hybrid and electric cars in Beijing, but it's a wait- and-see situation for us at the moment."And what about more brands to join Geely in the Hughes' portfolio?  "I've got no comment on that. We are totally committed to the distribution of Geely."