China Opens Its First European Auto Plant

By: EW News Desk Team   Date: 22 February 2012

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EW News Desk Team

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22 February 2012

Chinese automaker Great Wall Motor has opened its first European plant in Bulgaria as it aims to boost sales of its Great Wall Hover SUV, and other select models, in the region.

In a partnership with Bulgaria’s Litex Motors, the factory in the northern village of Bahovitsa will initially produce 4,000 vehicles a year using China-imported kits, rising to 50,000 by 2013.

Great Wall’s president and chief executive Feng Yingwang said:

Great Wall’s plan to build a plant in Bulgaria and produce automobiles here are aimed at boosting our production capacity and exporting these automobiles for the European market. We estimate that in three to five years we will have a wide range of models made here and these cars will be sold in all European countries.

According to Litex Motors’ marketing director Ivo Dekov, it is the ‘first plant for a Chinese automaker that will produce in Europe and for Europe’.

Related: China Auto Industry

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China has one of the largest markets for automobiles and currently exports its vehicles to over 120 countries across the world. The expansion into the European Union, Feng said, was of ‘key strategic importance’. According to Reuters, Great Wall exported 83,000 units from China last year.

The plant will employ 150 workers, before expanding its headcount to 2,000 workers when operating at full capacity in 2013.

With the joint-venture that was signed in 2009, Great Wall would be able to export its automobiles to the EU market, tax-free. Great Wall’s China-made vehicles have already been on sale in Italy since 2006.

The exponential growth China’s auto market slowed last year and European demand is expected to contract further as austerity and economic uncertainty bite into consumer spending.

Still, China’s top manufacturer of sport utility vehicles and pick-up trucks will aim to sell 600,000 vehicles in 2012, an increase of 23 percent, with an export target of 100,000 vehicles.

According to the AFP, Chinese automakers are increasing their buy-ins of European firms, an attempt to gain a foothold in one of the largest car markets.

In Britain, Geely, the same company that acquired Volvo, plans to introduce its mid-range sedan by the end of 2012 at a competitive price of 10,000 pounds ($15,787). At the same time, China’s biggest homegrown carmaker Chery Automobile purchased a Sicilian Fiat plant at the end of last year.

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