Chinese automaker SAIC Motor Corp., the local partner of both General Motors Corp. and Volkswagen AG, on Tuesday held the official launch for its first own-brand car, the Roewe, REPORTED AP. The high-end sedan was built by state-owned SAIC using technology from Rover. SAIC owns the technology rights for two Rover models, the 25 and the 75, bought from Britain's MG Rover Group Ltd. last year. Dubbed the Roewe 750 _ SAIC lost out to Ford Motor Co. in its bid for the Rover brand name _ the car was presented to VIPS and domestic media only in a ceremony that featured a fashion show and live jazz music, according to a statement from SAIC. Foreign media were not invited to the ceremony held in Shanghai's western suburb of Anting, which aspires to become China's version of Detroit. «This is mainly meant for the domestic market,» an SAIC official said. Like many Chinese officials, she did not give her name. SAIC is hoping to use Rover's reputation to gain a niche for the Roewe, known as the Rongwei, or glorious power, in Chinese, in the European market as well. According to SAIC, the name «Roewe,» pronounced «roo-eevee,» was chosen because of its resemblance to the Spanish word for lion and to the English word «we,» for the «power of the masses.» The company has an initial target of 600,000 SAIC-branded vehicles a year by 2010. It eventually plans to boost production to 2 million units. SAIC is one of several major state-owned automakers that China plans to build into internationally competitive auto conglomerates. Opinions are divided over the potential for SAIC, a latecomer to the market despite its domestic roots and ties to GM and VW, to break into the increasingly crowded passenger car market. From the low end to the high, virtually all the world's biggest automakers have been putting billions of dollars (euros) into ramping up production. «I think it will be really hard for Roewe to find a niche in the market. I don't think it will do well in the local market unless there is a big purchase from the government,» said Zhang Xin, an analyst at Guotai Junan Securities' Beijing office. «They'll have a hard time setting a price. If the price is too low, it won't suit the product's so-called high end image and if it's high, their target customers have lots of choices among international brands.» Government vehicle purchases once accounted for virtually all auto sales in China but now only take 15 percent of the market, according to state media reports. The Roewe is a far cry from the old Red Flag sedans traditionally used for communist dignitaries, according to SAIC's description. The wide-bodied sedan sports genuine leather seats, Goodyear tires and has a top speed of 220 kilometers per hour (140 mph), it says. «In China, there are only two local companies who can enter successfully, FAW Group and SAIC,» said Yale Zhang, a Shanghai-based auto analyst with CSM Worldwide. «These two companies have the longest history in China's automotive industry,» Zhang said. FAW, a partner of both Toyota and Audi, plans to reintroduce a revamped version of the Red Flag, or Hongqi, at the Beijing Auto Show next month, the state-run newspaper Shanghai Daily reported Tuesday. FAW is targeting the sedan, dubbed the HQ3 and based on Toyota's Majesta, at government purchases of high end model cars, a segment now dominated by Audis, Mercedes-Benz and BMWs, it said. A sign of the times: FAW is also developing a bulletproof model, it said.
