China stops subsidies to vehicle buyers in rural areas starting today

The Chinese government will end subsidies for vehicle sales in rural areas starting today, three days after announcing a halt in incentives for buyers of small vehicles.

The incentives being stopped in rural areas include those for small cars and trucks, the Ministry of Finance said in a statement on its website today. That will end a policy started in March 2009 to foster automobile demand at the height of the global recession.

The government said Dec. 28 said it will raise the sales tax on vehicles with engines of 1.6 liters or smaller to 10 percent from its current 7.5 percent. The tax was 5 percent last year.

Policies including a consumption-tax rebate, subsidies for rural car buyers and incentives of up to 18,000 yuan to trade in older models helped China’s total vehicle sales jump 46 percent last year. The nation overtook the U.S. to become the world’s biggest automobile market.

China’s vehicle sales may reach 20 million units in 2011, according to Bill Russo, a Beijing-based senior adviser at Booz& Co.

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Porsche wins dismissal of fund suits over VW shares

Porsche Automobil Holding SE won dismissal of two lawsuits over claims the company cost hedge funds more than $2 billion when it misled short-sellers in its acquisition of Volkswagen AG shares in 2008.

U.S. District Judge Harold Baer in Manhattan today dismissed the complaints filed by hedge funds Elliott Associates LP and Black Diamond Offshore and representing a total of 39 U.S. and foreign-based funds. The suits accused Stuttgart, Germany-based Porsche of secretly cornering the market in Volkswagen shares.

The short sellers claimed that Porsche misled investors by denying through much of 2008 that it intended to acquire Volkswagen and by using manipulative trades to hide its stock positions. Porsche said on Oct. 26, 2008, that it controlled most of Volkswagen’s common stock, causing the shares to surge as short sellers raced to cover their positions.

In his opinion, Baer said he relied on a recent U.S. Supreme Court ruling that fraud claims such as those in the suits against Porsche apply only to securities listed on domestic exchanges and domestic transactions in other securities. Baer said his ruling today applies to other similar complaints against Porsche.

‘Functional Equivalent’

The swaps at issue in the case“were the functional equivalent of trading the underlying VW shares on a German exchange,” Baer wrote.“Accordingly, the economic reality is that plaintiffs’ swap agreements are essentially transactions conducted upon foreign exchanges and markets and not domestic transactions.”

Porsche took another step toward its planned merger with Volkswagen, based in Wolfsburg, Germany, and Europe’s largest carmaker, after the company’s shareholders on Nov. 30 backed a 5 billion-euro stock sale to lower debt. The sports-car maker agreed to combine with VW in August 2009 after a failed attempt by Porsche to gain control of VW.

The court also dismissed claims against Porsche SE’s former chief executive officer, Wendelin Wiedeking, and its former chief financial officer, Holger Harter. Porsche announced the ruling in an e-mailed statement today without commenting on it.

David Parker, a lawyer representing Elliott Associates, didn’t immediately return a call seeking comment after business hours.

The case is Elliot Associates, Black Diamond Offshore, Ltd. v. Porsche Automobil Holding SE, 10-0532, U.S. District Court, Southern District of New York.

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JAC to export 620,000 cars to Brazil in next 10 years

Chinese carmaker Jianghuai Automobile Co.,Ltd. (JAC) started shipping the first batch of 500 cars to Brazil on Tuesday.

It signed a deal in August to export 620,000 ethanol-powered cars to Brazil in the next 10 years.

In a statement on Wednesday, the company said it will send the second and third batches, 1,500 and 2,500 cars respectively, in January and February next year.

In August, the company announced it signed the Exclusive Distributor Agreement with Brazilian dealer SHC.

JAC Motors, among the top 10 Chinese carmakers, sought to break into the world No.4 auto market that has been long dominated by US and European automakers and has a high entry threshold.

She Cairong, deputy general manager of JAC Motors, said:"We should continously broaden our global vision to gradually compete with global auto giants."

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Federal-Mogul recalls parts in some Chrysler vehicles

Federal-Mogul Corp is recalling 22,689 replacement control arm assemblies in certain older model Chrysler vehicles after it found a fault that could cause vehicles to crash.

The Michigan-based auto parts supplier said a part of the assembly, a ball stud, could wear through the assembly housing, causing the driver to lose steering control, said a notice filed with the U.S. National Highway Traffic Safety Administration.

The control arm assembly is the main link between the vehicle frame and the wheels and allows the wheels to go up and down independently of the chassis.

While more than 22,000 assemblies have been recalled, Federal-Mogul said it was not sure how many vehicles are affected by the recall.

Federal-Mogul spokesman Jim Burke said the number of these parts in each vehicle depends on the type of suspension, but usually is one or two per wheel.

The recall affects six Chrysler-brand vehicles from the model years 1995 to 2006. It includes the Chrysler Sebring convertible and the Chrysler Sebring sedan for the model years 1996 to 2006.

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JAC plans to invest $4.5 mln in EV project

Shanghai December 7 (Gasgoo.com) Anhui Jianghuai Automobile Co., Ltd. (JAC) announced yesterday that it plans to invest 29.8 million yuan ($$4.5 million) in verification equipment for pure electric vehicle R&D, 163.com reported Tuesday.

JAC will consolidate and develop its core business, the light truck and the Refine commercial vehicle, and bolster development of sedans, its strategic business, and take the initiative in developing new energy vehicles in the next five years, the company said in a statement.

Always adhere to the principle of"best quality and efficiency, and of building brands on quality", JAC said it will make itself a major automaker in China with relatively strong international competitiveness in five to ten years.

The company aims to boost annual sales to 1.3 million vehicles, generating sales revenue of 89 billion yuan by 2015, and to gradually increase the figures to 1.6 million and the sales revenue to 112 billion yuan. 
 

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Chery DR3 to enter European market next June

Chery DR3, a four-door hatchback car mirrored on Chery Fulwin2, will stage on the Bologna Auto Show from December 4 to 12, and will enter the European market in June next year.

With 1.5-liter/4-cylinder engine and a 5-gear manual transmission, the DR3 has a maximum horsepower of 108, and will sell at 53,000 yuan ($7,800) in China.

The DR1, based on Riich M1 electric car, will also be shown at the show. It is equipped with 40-kilowatt electro-motor and iron-phosphate-based lithium-ion batteries, which can be fully charged by a 220-volt voltage within six to eight hours. Riich M1's maximum speed is 75 miles per hour, and its mileage 100 miles. In China, Riich M1 sells at 150,000 yuan ($22,500).

Although Italian auto importers first showed standard gasoline-powered DR1 on the Bologna Auto Show 2008, there is no official confirmation it will enter the European

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Toyota China sales up 17% in November

Toyota currently has two joint venture partnerships in China, one in the north with First Automobile Works (FAW) and one in the south with Guangzhou Auto Company (GAC), the two JV’s are in a perfect position in which to cover the major geographical bases in China, this method seems to be paying off quite well for Toyota who have announced that sales have increased by 17% in November after a sales drop in October.

A total of 82,900 Toyota vehicles were sold in November 2010 which is a year on year increase of 17% over November 2009′s figures, October 2010 was a poor month for Toyota when they saw their first sales drop in 18 months, although yearly sales for Toyota are at 726,500 units in the first 11 months.

In 2011 Toyota is going to have a major focus on small displacement vehicles which have so far been driving the big sales figures in the Chinese market, the Toyota Verso will launch at the Guangzhou Auto Show and will be powered by a 1.6L engine, making it the third small displacement car on offer from Toyota in China.

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Renault Fluence EV goes for test run in China next year

Shanghai December 3 (Gasgoo.com) Renault will deliver a small number of Fluence EVs into China in 2011 to test the market, saying large volume delivery will need to be further discussed due to the lack of supporting infrastructure, the Beijing Times reported Friday, citing Chen Guozhang, CEO of Renault Greater China.

It is reported that orders for 200 Fluence EVs have been received from China since the French automaker unveiled the car at the 2010 Paris Auto Show. Five Fluence EVs will be shipped to China next year for test drive. Renault and Nissan will jointly develop plans for electric vehicles. 

The Fluence EV, based on the Fluence Z.E. Concept, has both standard and rapid-charge capability and can be recharged through"QuickDrop" battery exchange, Renault said. The standard Fluence has 1.6- and 2.0-liter gasoline engines and a choice of five variants of the 1.5-liter diesel.

Renault Greater China will hold a meeting this week to analyze the development of electric vehicles in China for the sake of formulating more specific development programs in the future, Chen said.

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Renault Fluence EV to test China market next year

Shanghai December 3 (Gasgoo.com) Renault SA will deliver a handful of Fluence EVs into China in 2011 to test the market, saying large volume delivery will need to be further discussed due to the lack of supporting infrastructure, the Beijing Times reported Friday, citing Chen Guozhang, CEO of Renault Greater China.

It is reported that orders for 200 Fluence EVs have been received from China since the French automaker unveiled the car at the 2010 Paris Auto Show. Five Fluence EVs will be shipped to China next year for test drive. Renault and Nissan will jointly develop plans for electric vehicles. 

 The Fluence EV, based on the Fluence Z.E. Concept, has both standard and rapid-charge capability and can be recharged through"QuickDrop" battery exchange, Renault said. The standard Fluence has 1.6- and 2.0-liter gasoline engines and a choice of five variants of the 1.5-liter diesel.

Renault Greater China will hold a meeting this week to analyze the development of electric vehicles in China in order to formulate more specific development programs in the future, Chen said.

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