Own auto brands accounting for 70%

　　When people feel excited about China's becoming a large auto country and the largest auto consumer country in the world, Sohu Auto interviewed Zuo Yanan, chairman of JAC. Main topic of our interview is about distance China far away from a powerful auto country and how to achieve that. Records of the interview are as follows:

　　Sohu Auto: Output and sales number of China reached more than 13 million units last year, and China also become the largest auto consumer country in the world, so do you think China is a powerful auto country now?

　　Zuo Yanan: Definitely China is not a powerful auto country now.

　　Sohu Auto: In your opinion, what factors a country must have to become a powerful auto country. And how China can become a powerful auto country?

　　Zuo Yanan: In my opinion, own auto brands accounting for more than 70% of market share means China is a powerful auto country. Besides, own auto brands must have certain market share in medium-class car. In terms of research and development capability and industry system, the most important is to build complete industry system of own auto brands. In other words, from material technologies, R&D, validation, the number of entire vehicle core parts to manufacturing, sales, logistics, reserves and subsequent business services. The above chains of industry system are must complete, rather than a lot of industries along the coast have to do low-end such as OEM. In terms of industry system, we also hope technologies and level can catch up high levels of those developed countries. There should be a certain premium capabilities of our auto brands, measured through this standard, China’s own auto brands still have a long way to go and we must take the problem into serous consideration. Now we are optimistic about 13.7 million units, however, when we calculate who earns most in it we will be astonished.

　　Sohu Auto: You said China’s auto industry still has a long way to go, so how long will it persist?

　　Zuo Yanan: It can be long and also short. If we have good industry policies, a suitable development strategy, industrial planning, auto industry strategic match, and harmonious relationship between Chinese government, auto enterprises and the public, ten years is proper.

　　Sohu Auto: Ten years?

　　Zuo Yan'an: After ten years, China will be able to become one of powerful auto countries. How long South Korea has taken? In the 90s of last century, development level of South Korea amounted to or was inferior to development level of China in 2005. Now South Korea’s auto industry is pretty competitive and it can compete with any country. In fact, with persistence, clear purpose and effective measures we can accomplish a lot of things. If we don't have clear strategies and our policies or plans are not consistent with strategic purposes, it is not a matter of time. Maybe our own auto brands will become factories only producing foreign products soon. Why? Now the risk exists, such as mobile phone industry, high-end mobile phones earn more money but low-end products can enter market easily for its low price. Cars are also possible, if the price of LOVA declined to 60000 RMB and the brand premium is 10000 RMB, similar products can sell with the price of 50000 RMB. Our 50000 RMB is equal to their 60000 RMB in customers' heart, therefore, this is very dangerous, which car is best is hard to verify.

　　For example, if foreign brand cars with a displacement of 1.3 liters also sell in China, its quality may not exceed us though its price is 10000 RMB than our cars. Where the problem is? Its brand has premium.

　　Sohu Auto: Just now you talked something about the status of a powerful auto country. Status of the largest auto consumer country does not make sense.

　　Zuo Yanan: It does not make sense. It is a good thing considering that there are so many people can afford cars, however, it has no sense for industry safety and long-term development of China’s economy. To be a large auto country is simple, the thing we need is persistence otherwise China’s auto industry will lose the ability to compete with other auto giants.

　　Sohu Auto: Can China become the largest auto consumer country in the world again?

　　Zuo Yanan: I think that there basically has no problem. Last year China surpassed the United States, nevertheless, slow growth of western countries is not so bad, they have a clear brain and are reluctant to develop very fast.

　　Sohu Auto: Rapid expansion will bring a series of problems.

　　Zuo Yanan: The economy can’t endure big ups and downs. For instance, in cities such as Hainan, and Haikou when the situation deteriorated many buildings are somewhat useless. Such irrational things can’t be done in foreign countries while there are many irrational things in our economic construction. Therefore, I predicted that consumption of the United States wouldn’t climb soon and China will continue to remain the world's largest auto consumer country. (Translator: Qinghua Wade)

　　See original Chinese report Please click:

　　http://auto.sohu.com/20100228/n270476490.shtml