State-owned GAC Automobile Group Co. plans to set up plants in Russia and Iran as part of its expansion efforts. (Photo : REUTERS)
Aiming to expand overseas, state-owned GAC Automobile Group Co. may establish plants in Russia and Iran to assemble vehicles using kits from China, according to a Chinese media report.
Internet Info Agency, a Beijing-based website, quoted GAC general manager Wu Song as saying that the company is now looking for a local partner to construct the plant, after studying the Russian market for a year and a half.
Wu said that GAC will first find a partner before it builds a plant in Russia that would initially produce 50,000 vehicles a year.
For Chinese automakers, Russia and Iran are key export markets. But when the Russian economy slid, sales of Chinese brands fell nearly 53 percent in 2015 to 39,085 vehicles, according to Automotive News China.
In Iran, Chery Automobile Co. is the largest exporter among Chinese carmakers, with sales of about 40,000 vehicles in 2015.
Wu, however, did not reveal the details about GAC's proposed assembly plant or the models to be produced in the plant in Iran. But it is likely that the facility would assemble cars for the Trumpchi brand, which GAC launched in 2010, the report said.
Last year, Trumpchi's global sales rose 45 percent to 195,134 vehicles, which included 1,455 vehicles shipped overseas. GAC's export markets include the United Arab Emirates, Kuwait, Lebanon and Qatar.
The report said that although GAC appears to be focused on Russia and Iran, it has also shown some interest in the U.S. market.
At the Detroit auto show in 2015 and 2016, GAC showcased the Trumpchi GS4 crossover. Wu also told the press at the Shanghai auto show in April that the company planned to launch the GS4 in the U.S. in 2017.
Wu did not disclose any details but the report said that GAC has not recruited dealers in the U.S. yet.
GAC, based in Guangzhou, has joint ventures in China with Toyota Motor Corp., Honda Motor Co. and Fiat Chrysler.
