Geely News

WA-based Chinese Automotive Distributors, part of the John Hughes Group and the national distributor for both Geely and ZX Auto, says it demanded a minimum four-star crash rating for the Cruze-size Geely EC7 sedan before considering selling it in Australia.Geely's recent testing to ANCAP standards didn't meet its importer's demands, halting plans to introduce the car to Australia. A director of the group, Rod Gailey, says CAD wanted a minimum of a four-star ANCAP crash test rating for the Cruze-size sedan before considering it for sale in Australia.“The EC7, which had previously scored a Euro four-star rating, recorded a sub-four star rating despite additional safety equipment such as electronic stability control and six airbags,” he says.He says the decision to halt the import plans was one made both by CAD and Geely. “The minimum four-star crash rating was agreed by both Geely and ourselves before Geely conducted the tests,” he says.“We insisted, and Geely agreed, that we wouldn't import the car until it reached a four-star or above crash test rating and unfortunately it didn't meet our expectations.“So Geely and ourselves have put everything on hold.” Mr Gailey says it was possible that the body structure of the car is at fault. He says Geely indicates it isn't economically viable to re-engineer the car to meet higher safety standards for Australia's small volume market.He says it could take 18-24 months for Geely before a new range of models - now in the post-design stage - that satisfy Australian demands for safety and features would be available for Australia. “But Geely has told us that the new cars won't be cheap,” he says.“This will be a new generation of models that will be more competitive in terms of design, engineering and performance so I can't see them being available at the lower-end of the price market.” Mr Gailey says the EC7 was a “quantum leap” ahead of the first Australian-sold Geely, the MK1.5. “But even the EC7 is not engineered for the mature markets,” he says.“We continue to remain involved with Geely, working in partnership on their future model platforms whilst maintaining sales and service support for the Geely MK in Western Australia.” Geely has a range of sedans and SUVs that have potential in the Australian market. The company, which owns Volvo, now sells to 30 countries and exported 100,000 cars in 2012. 

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 

There’s always at least one crazy at any motor show. Once-conservative China is leaping aboard the outrageous concept-car wagon with Geely - one of China's biggest car makers with a $24 billion turnover in 2012 - trotting out its baby Panda with a 4WD undercarriage. Suitable for Shanghai and Beijing crowded city streets? Definitely. The shoehorning of a big truck frame beneath the Panda - normally a breathless 63kW bubble car - is purely to draw a crowd. Pity Geely didn't apply the same graft on one of its existing 4WD utes. The Panda - called LC in export markets including New Zealand - was on the cards for Australia but was knocked back this year because of the lack of electronic stability control. It does, however, have a five-star crash rating on the China-NCAP test program. The car can't be called a Panda in most markets because the name is registered by Fiat. To reiterate the Panda name in China, the design features Panda paw-shaped tail lights.

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.

That’s Volvo’s plan as it begins to roll out a range of electric and hybrid cars. It is making its own four-cylinder engine and plans to turbocharge it and add it to hybrid drivetrains within a few years. That means the end of Volvo five and six-cylinder engines, says Volvo’ senior vice president for product, Lex Kerssemakers. Speaking to Carsguide in Frankfurt, Mr Kerssemakers says Volvo’s Chinese owners - Geely - have supported the Swede and allowed a fresh look at new product.Though Mr Kerssemakers was reticent on detail, he says Volvo was now ready to release a new S40 - and its wagon variant, the V50 - which would boast increased fuel efficiency. “We had to ook at what we were and what we represented to our buyers,’’ he says. “We have always been seen as a company that was very aware of its social responsibility - and that includes the emissions of our cars - through safety. “We have progressed to making very good looking cars. We also make very good turbocharged engines - we have been doing turbocharging for 30-odd years - so now we have the basis for a step into the future.’’Kerssemakers says the new four-cylinder engine will be available in power outputs from 110kW to 220kW and deliver up to 440Nm of torque. “Now, put that with an electric hybrid drive with 200Nm and you have a very fast car that is capable of very low fuel consumption,’‘ he says. “Instantly, you have a sports car. It’s a very clear choice for us - ditch the cylinders. “We are developing our own engine nd it will be available in a few years. There will be overlap from the existing engines but ultimately, we will be a four-cylinder car company with hybrid and plug-in electric capability.’’Volvo is trialling a fleet of C30 plug-in cars in Scandanavia and is expected to start rolling out hybrid models from 2012. Kerssemakers says while Sweden doesn’t offer government subsidies for private motorists who choose low-emission cars such as hybrids, he says the cost benefit to the owner was very significant. Kerssemakers expressed concern about the plight of Saab. He says the possible loss of the company from Sweden would be “devastaing’‘ to supplier companies and to Sweden itself. “It also affects engineering and design students coming through universities and in that way, erodes Sweden’s value as a supplier of intellectual property,’‘ he says.Saab is still fighting for financial survival and was absent at the Frankfurt motor show.

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 Geely CK, which is sold without airbags in Latin countries and the Caribbean, scores zero stars in the same 64km/h frontal-impact test used in Australia. The best of the nine cars ranked in the first Latin NCAP testing is the Toyota Corolla with four stars, but four of the cars are sold without airbags and scored poorly. The Geely did, however, manage two stars for child occupant protection although the NCAP results point to "significant collapse of the bodyshell during test". Latin NCAP joins a growing worldwide safety push through independent crash testing and evaluation of life-saving motoring technology.  “We are introducing Latin NCAP to Latin America and the Caribbean because we want to see a dramatic improvement in the safety of cars across our region. Our ultimate and most important aim is to save people’s lives," says Nani Rodriguez, executive secretary of Latin NCAP. The nine cars tested are among the most popular models sold in Latin America and the Caribbean. Latin NCAP scores: Geely CK (no airbags) - zero starsFiat Palio (no airbags) - two starsFiat Palio with airbags - three starsVW Gol (Subs: correct) (no airbags) - one star Peugeot 207 (no airbags) - one star Peugeot 207 with airbags - two stars Chevrolet Meriva - three stars Toyota Corolla - four stars

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."

The first large-scale imports of passenger cars will begin later this year and the man leading the China drive refuses to put an upper limit on sales, or the rate at which they are likely to grow in Australia. Great Wall is already selling a low-cost utility and SUV but the floodgates will open in the final quarter of this year when the Geely and Chery brands begin sales of compact passenger cars with prices - and value - that undercuts the Korean benchmark brands."Would it be silly to say the Chinese will have 10 per cent of the market in five years? I don't think so," says Rick Hull, who heads Great Wall and Chery in Australia.  He has vast experience of low-cost imports after heading up the import action for the three biggest Korean brands - Hyundai, then Daewoo and finally Kia - during his career.Hull said it took the Korean carmakers around 10 years - with help from Ford sales of the Korean-built Ford Festiva - to top 100,000 sales a year.  He already believes the Chinese brands could do it in half that time, thanks to cheap labour rates, rapid technology improvements, growth in total vehicle sales in Australia, and the earlier example of Japanese and Korean brands."I really don't know how fast it will happen. But it has the potential to happen very quickly," Hull says, as he leads a small group of Australian journalists to Chery, Great Wall and the Beijing motor show this week.  Hull believes many more Chinese brands will eventually join the export push, with 47 major makers in the country and production capacity soaring towards 20 million vehicles a year.He is not expecting much action from the 26 joint-venture makers - Chinese companies in partnership with everyone from Volkswagen and General Motors to Volvo and Suzuki - but knows the 21 independents will be looking for growth outside their home country.  In Australia, Hull believes there will not be any sub-$10,000 pricetags but he predicts rapid growth in high-value compact cars and big, fast changes to the way Chinese cars look and feel.He says safety and quality will become a top priority much faster than they were in Korean cars, because the Chinese must compete on equal terms and win buyers with a value-added edge in showrooms.  Korean sales reached their peak in Australia at around 112,000 in 1998, just 12 years after Hyundai was established with the original Excel.Hull believes Chinese brands can hit the same 100,000-a-year benchmark in less than half that time and does not rule out China-made cars quickly overtaking Thailand - currently the biggest overseas supplier to Australia at around 220,000 a year - son after 2020. "Who really knows? Five years for the Chinese to hit 100,000? I think that could easily happen," Hull says.  "And you have to remember that the market in Australia is now profoundly bigger than it was when the Koreans did it."

The three companies with Australia in their sights - Great Wall, Chery and Geely - are all expected to unveil new value-driven compacts and SUVs at the country's biggest annual motoring event.  Great Wall is the only brand with vehicles already in local showrooms, a dual-cab ute and SUV, but Chery and Geely will both hit the road down under before the end of 2010.BYD, a technology leader for China, is also planning to reveal its first plug-in electric cars in Beijing although it currently has no plans to sell overseas.  All 47 of China's manufacturers are expected to have something new at the show, with a move away from the copycat designs of the past - everything from the Rolls-Royce Phantom to the BMW X5 was either parodied or duplicated - to unique Chinese designs."They will all show their new export cars," says Ric Hull, the Ateco Automotive executive responsible for the Great Wall and Chery brands.  Hull says the Chinese car industry is advancing so rapidly it is hard to keep tabs on the new-model action."I think everything has to be seen in the context of the market. The Chinese made and sold about 13.6 million vehicles last year, and the US was 10.4 million," he says.  "They have not only eclipsed the US, they have gone way beyond them. In good years the US is 17 million, but the Chinese are there already."In the first quarter of this year, they have sold 4.6 million vehicles. So you're now talking 18 or 20 million a year. It's just gone bezerk.  "The thing that fascinates me most is how anyone can lift production to those levels. I don't believe the Japanese could do it, or even the Koreans."Hull says Ateco is already on track with additions to the Great Wall range including a single-cab ute, with Chery to hit first with a compact SUV.  "We'll launch Chery in August. It has just been an agonizing process to get the compliance issues in place, but it will be fine."I'm hoping to launch a RAV4-kind of vehicle at a really good price.  "Great Wall are talking about a 1.5-litre car that we'll introduce before the end of the year. They are getting there and getting there awfully, awfully quickly."Hull says he is expecting rapid improvement in Chinese vehicles, with quality and safety as top priorities.  Great Wall is just about to face its second ANCAP crash-test barrier in Australia and, following the miserable two-star result for the ute, Hull is hoping for a four-star rating for the brand's SUV."We took a hammering from NCAP on the utes but Great Wall reacted and they have made a lot of changes," Hull says.  Car sales in China are so important that all the world's major makers will be displaying in Beijing.Even though many skipped last year's Tokyo Motor Show, previously the world's equal number one with Frankfurt every two years, no-one can afford to miss the biggest motoring event in China.  There were more than a dozen world previews at the last Beijing show and a lot of the action is at the upmarket end of the business in 2010.Ferrari is unveiling its new go-faster flagship, the 599 GTO, and Mercedes-Benz will reveal an update of the $1.5 million Maybach ultra- luxury limousine.