Official vehicles embrace more Chinese brands

Under the current market environment, it is no doubt good news for the Chinese auto industry that the government is giving a hand to Chinese brands, supporting and guiding their development.

This year, government purchase lists are seeing an increasing number of brands from domestic corporations, such as First Automotive Works (FAW), Shanghai Automotive Industry Corp (SAIC), Guangzhou Automobile Group Corp, Beijing Automobile Industry Corp (BAIC), Geely, BYD, Great Wall, Dongfeng Motor Corp, Huachen Auto Group, Chery, and Jianghuai Automobile Corp.

Zhang Zhiyong, an auto industry analyst, said that government purchases do not account for a large proportion of vehicle sales. For automakers, individual consumer market is still the main source of profits. For the purpose of improving brand image and further driving consumption in the private market, FAW, SAIC, and BAIC decided to explore the government market.

Another auto industry analyst, Jia Xinguang, said Hongqi production has been halted several times. "Though Hongqi H7 is backed by government this time, there is still a long way to go. We need to pour more energy into the process of product development."

While many domestic brands are concentrating on the high-end car market, Dongfeng, ranking second among Chinese brands, is seizing opportunities in the SUV market. Liu Weidong, vice general manager of Dongfeng, said that with Mengshi's advantage in the military vehicles market, they would introduce Mengshi to private customers as well as the government.

Zhang says that by focusing on the SUV market, Dongfeng avoids cut-throat competition in high-end vehicles and places hope on a top-down marketing strategy.