China FAW Group Corporation is currently billed as the number one automobile maker in China, and is also one of the oldest in the industry, dating back to 1953. FAW Group, or more commonly know as simply FAW, has a wide-ranging base of products, from passenger cars, mini (utility) vehicles, sport utility vehicles (SUVs) and pickup trucks, to commercial trucks, buses and coaches.
FAW also makes components and parts such as wheel rims, truck axles, engine parts and pumps. In recent years, FAW also entered several joint ventures with Toyota and other manufacturers in other countries such as Russia. In fact, its joint venture with Toyota became the reason for the existence of the Toyota Prius. Toyota also produced the Vios and Corolla models through a partnership with FAW’s Tianjin unit. Aside from that, FAW also worked with Volkswagen AG and came up with a high-tech production facility that produces large numbers of cars every year. The company has now grown to become the China FAW Group Corporation from its humble beginnings as a truck maker, and from 1953 up to the present, it has remained at the forefront of China’s car industry. Until now, it maintains its truck market but has expanded and is offering high-quality cars to other markets as well.
Another market that First Automobile Works is currently tapping is the clean car market. The industry has yet to grow, but First Automobile Works is working hard to achieve its goals in the clean car segment. Aside from its continuous efforts in improving sales and production of its current market offerings, the company is also paying attention to the production and development of hybrid cars.
FAW and Toyota Collaboration
One of the most popular and significant advancements in the clean car industry is the Toyota Prius, a heavily marketed hybrid car produced by Toyota in collaboration with FAW. Produced a few years back, the Prius was released in China after Toyota and FAW entered a 50-50 partnership venture. The Prius is a 1.5L vehicle and consumes 40.5% less fuel than the 1.6L gasoline vehicle Toyota Corolla. Recently Toyota announced that its latest generation Toyota Prius will start selling in China in 2010. Despite the Prius’ relatively high price tag (up to 280,000 yuan or US$41,000,) Toyota has reason to be optimistic with expected consumer incentives by China’s central government to spur sales of clean cars including electric and hybrids. Source: gasgoo.com.
China’s automobile industry is very ripe for the introduction of hybrid cars. With the Chinese government wholly supportive and with the subsidies being offered to taxi fleets as well as tax benefits offered to consumers who patronize clean cars, car manufacturers such as FAW and Toyota recognize that there is no better time to introduce hybrid cars to the Chinese market than now. These efforts to further the development of clean cars aim to reduce pollution and relieve oil shortage problems being experienced not just in China but all over the world. Nonetheless, the Toyota and FAW partnership is also planning to release about 400,000 compact, medium, and high-end buses and sedans by the year 2010 to the Chinese market.
More hybrid cars are being planned for release under FAW brand. In fact, the entire FAW Group is expected to release around 1,600 hybrid cars before the year 2012 ends. During the same timeframe, the company is hoping to produce 800 hybrid buses. Most of the hybrid cars are planned to have hybrid engine technologies sourced from Japan’s top car makers. Its hybrid vehicle products produced together with Toyota are expected to hit the global market since Toyota aims to distribute said products globally. These upcoming clean cars will be produced at a special hybrid car facility. FAW has also shown its determination to see the said project through to the end by increasing its investments. There is surely a lot to wait for from FAW.
We’ll look at FAW’s work in hybrid buses in Part 2.