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Reported by the First Financial Daily in Jan 7th 2013, the newly-built No.3 passenger car factory, for 5 billion RMB invested by JAC Automobiles, went into operation in Hefei Jan 5th. As the first product for JAC Automobile dual-brand strategy, the SUV Refine S5 was off the production line.

Under the influence of decreasing commercial vehicle sales volume, JAC Automobile’s retained profits have decreased badly since 2011. For changing this situation, JAC Automobile adjusted and re-combined company strategy and management structure. S5 was the first model after dual-brand strategy, which was directly related to the finance of JAC Automobile in 2013.

“The whole company are highly valuing S5, and we invested a lot in all fields. The increasing of profit this year depends on this model”, a man from JAC suggested to reporter from the First Financial Daily.
The JAC No.3 Passenger Factory was built in early 2010, with general investment up to about 5 billion RMB. The factory is for manufacturing the new 2nd-generation passenger vehicles of JAC, with production of 240,000 vehicles in double shifts. Additionally, the designed productivity of JAC has reached to 540,000 vehicles.

Before 2007, main business of JAC Automobile was for business vehicle, chassis and Refine MPV. JAC had started transformation for passenger vehicle in 2007, main business become in business vehicle, multifunctional vehicle and passenger vehicle. JAC mainly put the profits from business vehicle on passenger vehicle for its automobile transformation. Thanks to the “4 trillion RMB” policy in 2009, the business vehicle market had grown rapidly for 2 years, the JAC retained profit of 2009 and 2010 grown greatly up to 482% and 246%. While since 2011, wrinkling of the business vehicle market had great impact to the sales of JAC Automobile, which led JAC’s retained profit dropped to 618 million RMB, decreased by 46.88% on year-on-year basis. On the first three quaters of this year, JAC’s retained profit has decreased by 25.92% to 404 million RMB on year-on-year basis.

How can make passenger vehicle business beneficial? It’s already become the first mission for JAC “Business-vehicle-to- passenger-vehicle transformation” strategy. Therefore, great business structure recombination was operated inside JAC, and the developing of new product and productivity construction are synchronizing. JAC enhanced passenger vehicle dual-brand strategy, weakened the concept “JAC passenger vehicle”, divided passenger vehicle business into “J5” and “Refine”, the two business groups. Since the operation of No.3 Factory, JAC products would meet the requirement of plat-forming and generalization of accessories, which reduced manufacturing cost and increased overall profiting ability.

“Self-owned brand has developed too impetuously, we need to stick together for fighting”, Tao Zhi, vice GM of multifunctional marketing company of JAC Passenger Co., Ltd said.

In 2012, the 200,000-vehicles sales milestone for JAC passenger vehicle has been accomplished. The future sales for JAC passenger vehicle in 2015 will be 500,000 vehicles according to the plan.

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Issued date:2013年04月12日 page views:

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