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In the years following China's accession to the World Trade Organization (WTO), numerous Chinese-owned automotive brands and trademarks emerged within new joint ventures. However, managing these brands proved challenging due to fragmented strategies and limited control over brand positioning.
With the comprehensive collaboration between SAIC and Nanjing Automobile (NAC), the question arises: can the two brands "Roewe" and "MG" coexist and collaborate effectively under integrated management? According to Chen Hong, President of Shanghai Automotive Co., Ltd., "Roewe" and "MG" share significant technological and component resources. He explained that while MG Rover previously focused on sporty and fashionable designs, Rover emphasized luxury and robustness. These distinct positioning strategies helped shape the development of "MG" and "Roewe" as separate yet complementary brands.
Zhang Boshun, Secretary-General of the China Automobile Association’s Market and Trade Commission, noted that Chinese auto companies are currently competing in a relatively decentralized manner when it comes to building their own brands. The partnership between SAIC and NAC is expected to leverage synergies, accelerate innovation, and help create internationally competitive independent brands.
According to the "Eleventh Five-Year Plan for Development of China's Automobile Industry," an independent brand must be owned by the company with intellectual property rights. This can be achieved through independent development, joint efforts, or technology absorption and re-innovation.
At present, most domestic auto companies have not placed their own-brand projects within joint ventures. For example, the "Red Flag" brand, launched in 1958, has seen significant growth, reaching a brand value of 5.828 billion yuan in 2006. FAW Group, which produces the Red Flag, has been actively upgrading its product line.
In 2007, Dongfeng Motor initiated substantial construction of its self-owned brand, aiming to cover a range of vehicle classes from B to D, with the first model set to launch in 2009. Meanwhile, SAIC has invested 1.8 billion RMB to expand its Automotive Engineering Research Institute, aiming to become a leading domestic tech center by 2010.
Shanghai Automobile Passenger Vehicles Branch was established in 2006 to focus on the "Roewe" brand. After the cooperation with NAC, SAIC’s UK-based R&D and NAC’s operations will be integrated, creating three platforms: R&D, production, and marketing.
Chen Hong also mentioned that after the South Africa cooperation, the first step is to restore production in the UK, focusing on both legacy models and improved versions to strengthen the brand’s position in the market.
Brand confusion within joint ventures remains a challenge. Hu Maoyuan, Chairman of SAIC, highlighted the potential for expanding cooperation with Fiat or Iveco, adding more commercial vehicle models to Nanjing Auto. In 2007, the Yuejin brand was incorporated into Nanjing Iveco, with the foreign partner investing 60 million yuan to integrate core technology and meet European standards.
Zhang Boshun pointed out that although many joint ventures had Chinese brands, managing them effectively was difficult. For instance, SAIC-GM-Wuling operated under dual branding, with Wuling dominating sales. Zhang emphasized the need for stronger brand protection awareness.
The Triumph car, jointly developed by Shenlong and PSA, holds full intellectual property rights, but overseas production is managed by PSA, with Shenlong playing a supporting role. Similarly, FAW and Mercedes-Benz explored a joint venture for the "Liberation" brand, but concerns about brand dilution led to the abandonment of the plan.
Looking ahead, Zhang Boshun stressed the importance of viewing the development of independent brands as part of national strategy. By the end of the Eleventh Five-Year Plan, the Chinese car market is expected to see major changes, with independent brands and foreign brands coexisting.
Major domestic groups like Roewe, Red Flag, Chery, Geely, and BYD are shaping the future of the sedan market. Guangzhou Honda is also preparing to launch a fully Chinese-owned brand with independent intellectual property rights.
Overall, the path to building strong, independent automotive brands is complex, but with strategic collaborations and innovation, China is making significant progress toward global competitiveness.