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BMW Partners with Chongqing Loncin to Make Motorcycles(SinoCast China Transportation Watch Via Thomson Dialog NewsEdge) CHONGQING, November 13, SinoCast -- BMW and Chongqing Loncin Industry (Group) Co., Ltd., a Chinese motorcycle maker, will jointly develop and produce motorbikes with an emission of 800 cubic centimeters and above. At present, Loncin, headquartered in the southwestern city of Chongqing, is the sole motorcycle partner for Germany-based BMW in China, while they only develop and make engines for motorcycles with a displacement of more than 650 cubic centimeters. Such engines are all BMW branded and only supplied to the German giant, meaning Loncin is only an original equipment manufacturer for BMW, an official with Loncin once commented. The new partnership, however, will deepen their cooperation. Loncin has reached consensus with BMW to join hands in producing 800cc-and-above engines and motorcycles, disclosed an official with Chongqing's economic and trade commission. Chongqing, an old industrial base in China, is also striving to introduce BMW to produce automobiles in the city based on its current collaboration with the auto giant, according to a report by a local media. Days ago, an official at BMW headquarters who once was in charge of the company's motorcycle division, clearly expressed that BMW would take Chongqing as its strategic investor and expressed the hope to contact with the municipality as early as possible, which hinted a great opportunity for Chongqing Under such circumstancers, Chongqing's economic and trade commission suggested that the local government should pay a visit to the German company to introduce its investment in Chongqing's vehicle industry. It is also reported that Chongqing has included the collaboration with BMW into the investment to be introduced in the eleventh five-year period (2006-2010). The report said that BMW had started to look for the target partner in Chongqing from the beginning of 2002, while no local company has wrapped up any agreement with BMW so far with regard to automobile manufacturing. Another official with the aforesaid commission said that the local government really wants to invite investment from the German firm, but it has not formed the team to specially take charge of the issue, and thus it is now mainly contacting with BMW via Loncin. Under present market pattern, the auto industry must enter into partnership with the global bellwether so as to quickly gain advantages in the competition, he continued. Chongqing, largest municipality in the country, is now redoubling efforts in creating itself into a "Detroit" in western China. Six out of the top ten motorcycle makers are from the city. In the aspect of auto manufacturing, Chongqing presently boasts Chang'an Automobile (Group) Co., Ltd. (Chang'an), the fourth biggest automaker in Chinese mainland, Qingling Motors (Group) Co., Ltd., a commercial vehicle producer, and Chongqing Lifan Industry (Group) Co., Ltd., a private carmaker. The city plans to boost its automobile output to 1.5 million units by 2010, accounting for 15% of the industry's total. Of them, 1.2 million units will be passenger cars and the remaining 300,000 units be commercial vehicles. Chongqing is the country's largest manufacturing base for motorcycles. It is the home to 24 motorcycle makers. Over the past year, the city produced 4.9423 million motorcycles, taking a 33% share in China market. Chongqing-based motorcycle companies saw their revenues stand at CNY 24.3 billion, accounting for 34.3% of the total industrial revenues nationwide, which hit CNY 70.9 billion. (USD 1 = CNY 7.9) Copyright 2006 Financial Times Ltd. |