According to the words of Skoda Auto CEO Winfried Vahland, the compact five door hatchback (pictured) represents a new aggressive strategy for the manufacturer. Mr. Vahland added that Skoda would be releasing a new model every six months for the next two to three years.

In other news, Skoda will be coming out with a new model made in partnership with Shanghai VW. According to reports, it will be a compact sedan placed between the Octavia and Fabia. Intellectual rights to the new car will be shared between Skoda and Shanghai VW. This means that whatever the final form of the Mission L is, it will be Skoda China’s sixth model.

BYD’s E6, used in Shenzhen as taxis, has been on sale since Oct. 26 to individuals for 249,800 yuan ($39,300) — after government subsidies. That’s 36 percent more expensive than Bayerische Motoren Werke AG’s 120i and 16 percent higher than Audi’s A3 Sportback.

The price, coupled with a lack of charging stations, illustrates why the Chinese carmaker partly owned by Warren Buffett’s Berkshire Hathaway Inc. may turn off consumers. BYD is counting on electric cars for future growth as it faces slowing demand and mounting competition with gasoline-run automobiles in a country where the average household makes less than 60,000 yuan in disposable income a year.

“It will take 5-to-10 years and further development of the technology and infrastructure before retail consumers will consider” purchasing electric vehicles, said Bill Russo, a senior adviser at Booz & Co. in Beijing. “Saving the planet is not their priority.”

China, the world’s largest polluter, is promoting alternative-energy vehicles to reduce emissions and fuel imports. The government has a five-year plan that calls for 1 million electric-powered automobiles to be on its roads by 2015, according the Ministry of Science and Technology.

The central government is offering anyone who buys an energy-efficient car in Shanghai, Shenzhen and four other Chinese cities, a 60,000 yuan subsidy.

Electric Cars

BYD says customers will get their money’s worth. The five- seater E6 can run for 300 kilometers (186 miles) per charge, comes equipped with keyless ignition, an onboard navigation system and rear-view cameras, according to the company. The car is available at nine dealerships in Shenzhen, where BYD has its headquarters, and its availability will be expanded to other cities, according to the company.

“We are confident that E6’s quality will appeal to consumers,” Senior Vice President Lian Yubo said in an interview in Shenzhen on Oct. 26, declining to give a sales target. “There is limited production capacity and supply of the car so we think the price is appropriate.”

The E6 will cost $672 a year in power bills, compared with $1,571 in fuel costs for an equivalent family sedan that runs on gasoline, according to BYD projections based on annual mileage of 15,000 miles. BYD’s self-developed iron-phosphate battery takes 40 minutes to fully charge at public stations and as long as six hours when plugged in at home.

First Mover

Development of electric cars is a “key strategy for BYD,” the company said in an e-mail. The first major domestic automaker to offer electric vehicles to individual buyers in China, BYD has failed to translate head starts into market share in the past.

In 2008, it introduced the plug-in hybrid car F3DM in China from 149,800 yuan, compared with 59,800 yuan for the gasoline version. The automaker sold 906 of the dual-powered cars as of September, according to the China Association of Automobile Manufacturers.

BYD, formed 16 years ago as a battery maker, began developing electric cars in 2003, when the company expanded into automobile manufacturing. Its investments in the technology include a 1.5 billion yuan production line in Huizhou, Guangdong province, to make rechargeable batteries for cars, according to spokeswoman Veronica Jiang. She declined to give an investment amount for the E6.

MidAmerican Energy Holdings Co., a unit of Berkshire Hathaway, in July 2009 bought 9.9 percent of BYD for HK$1.8 billion, or HK$8 apiece. The stock climbed to as high as HK$85.50 in October that year and has since declined 78 percent in Hong Kong, last closing at HK$18.96.

Profit Plunge

Earnings are falling too. The company said Oct. 28 it expects profit to decline by as much as 65 percent this year after dropping 89 percent during the first half. China’s end to tax breaks for small cars led to 13 straight months of lower sales at BYD before a rebound in September, according to the nation’s auto manufacturers’ association.

The Chinese automaker faces a difficult task in convincing consumers to choose the E6 over entry-level luxury cars from companies such as BMW and Volkswagen AG (VOW)’s Audi in the world’s largest car market, said George Yin, an analyst with BOCOM International Holdings Co. in Beijing.

“There are way too many choices for Chinese consumers to shop for both foreign and local brands,” he said. “It’s a bad strategy to start as a taxi before expanding to retail sales if BYD really wants to make the E6 a volume product.”

Lexus, Audi

Audi’s A3, equipped with a guiding system that helps drivers parallel park, starts from 216,000 yuan, according to Cheshi.com, a pricing guide tracking more than 3,000 dealers in the country. The BMW 120i hatchback sells from 184,000 yuan, according to the website.

Still, the E6 is cheaper than Toyota Motor Corp.’s Lexus CT 200h hybrid hatchback, which was introduced in China on the day BYD unveiled the E6 and starts at 279,000 yuan. The car features a voice-activated GPS navigation system and radar cruise control.

BYD is counting on the government to help boost the popularity of the E6.

The city government will strive to facilitate the usage of electric vehicles and promote the E6, Li Ganming, a deputy director of the National Development and Reform Commission’s Shenzhen branch, said at last month’s BYD event, without elaborating.

The fleet of E6 taxis, operated by Pengcheng Electric Taxi Co., has clocked 600,000 kilometers since they were introduced in Shenzhen in May 2010, the company said on its website.

Domestic rivals say they’re in no rush to sell their own electric vehicles. Anhui Jianghuai Automobile Group Co., China’s biggest exporter of light trucks, will wait for the government to build more charging stations before starting sales of EVs to the public, Yang Jun, a deputy general manager with the automaker, said last month. The automaker has sold 550 electric vehicles to its employees.

Shenzhen, which spans across 1,953 square kilometers, has 60 charging stations. By comparison, neighboring Hong Kong, whose area is 43 percent smaller, plans to triple its number of charging stations to 1,000 in a year, Edward Yau, the city’s environment secretary, said in September.

“While being first carries the benefits for building an image as a technology leader, I believe we have already seen how quickly that can turn into a burden,” said Booz’s Russo. “The price needs to come down substantially in order to attract retail consumers.”

Beijing News: “Will the SUV make its official debut at Auto Guangzhou?”

Wu Song (pictured): “Yes. The Trumpchi SUV will make its debut at their November’s Auto Guangzhou show.”

Beijing News: “The mid- to high-end market is fiercely competitive this year, and it seems like it will be becoming more so in the future. The [Trumpchi brand] is about to enter the market with the new SUV. When facing this current environment, what mindset and plans do you have?”

Mr. Wu: “This year growth in the automotive market is slowing down, and a large drop is appearing in year-on-year growth. However, we already have our own plan. First, we will start from a strong position by improving [our] technology in pace with the rest of the world. On methods and ways to strengthen our manufacturing process, we currently have ten international auto part suppliers preparing parts for us. Secondly, [we] aim to establish an international-class factor, in order to ensure our product quality. Third, we are fully confident in the future. China will continue to steadily develop in the next 20 years, [and] with automobiles being an important tool in bringing about unfettered transportation, [the market] still has a large margin of growth. We have thought a lot about the Trumpchi SUV’s competitiveness.”

Beijing News: “Will GAC’s electric models come out by the end of this year?”

Mr. Wu: “Yes, they will. Research and development work on both electrics and hybrids is currently being done. In the future plan for the Trumpchi, [we] are also considering putting out electric and hybrid models. [We need to consider] market conditions and level of technology before setting any actual timetables.”

The study focused on buyers who reported having car problems two to six months after purchasing a new vehicle. According to the study, the average failure rate this year was 162 times for every 100 vehicles purchased, six percent lower than last year. Japanese brands had the best overall rate at only 108 times, followed by US and European brands at 131 times. Domestic Chinese brands ended up last at 224 times, a slight improvement of eight percent from 2010.

According to Chris Chen, automotive research manager for J.D. Power Asia Pacific, the most common problem for Chinese brands was transmission system failure. Another frequently occurring problem was engine damage when turning on air conditioning, which caused vehicle fuel efficiency to drop.

AutoChina.org (Detroit  November 7)- General Motors Co. indicated it may block the sale of its former Saab Automobile unit to two Chinese companies if the deal would harm GM’s interests.

“GM would not be able to support a change in the ownership of Saab which could negatively impact GM’s existing relationships in China or otherwise adversely affect GM’s interests worldwide,” James Cain, a company spokesman based in Detroit, said in an e-mailed statement.

Zhejiang Youngman Lotus Automobile and Pang Da Automobile Trade Co. agreed on October 28 to buy Saab from Zeewolde, Netherlands-based Swedish Automobile NV for €100 million (Dh506.23 million), and they have pledged to invest €610 million in the Swedish carmaker.

GM, which sold Saab last year to Spyker Cars NV, later named Swedish Automobile, must approve the deal if it is to proceed. Clearance is also required from Chinese authorities, the Swedish government and the European Investment Bank. Saab has produced few cars since it first stopped production in March because of a lack of cash, and is now under court-administered protection against creditors.

GM is waiting to get more information from Saab before it makes a final decision, Cain said in a phone interview.

“This position reflects our concerns as of today based on the information we have that’s incomplete,” Cain said, declining to elaborate about the concerns.

Ford China delivered 40,857 units wholesale vehicles in October, kept a similar performance compared with October 2010, said the company.

According to Ford Motor’s Chinese partner, Chang’an Ford Mazda Automobile (CFMA), the joint venture has sold 260,302 units Ford-brand cars starting from this year with a yearly increase of 6 percent. Sales of Ford-brand vehicles of the joint venture totaled 26,321 units, and the whole delivery of Ford-brand cars in China amounted to 31,370 units, up 2 percent year-on-year.

Ford Mondeo continued its strong momentum with 6,484 wholesale vehicles sold in October, a 39 percent increase from the same period last year. Meanwhile, Ford Focus sales crossed the 150,000 mark for the year, with wholesales of 156,217 vehicles from January to October, a 13 percent increase from the same period last year.

Jiangling Motors Corporation (JMC), Ford’s commercial vehicle investment in China, sold 163,358 wholesale vehicles so far this year, an increase of 11 percent. In October, JMC sold 14,006 wholesale vehicles compared to 14,117 last year.

From January to October, sales for the Ford Transit climbed to a record high of 48,292 wholesale vehicles, an increase of 13 percent from the same period last year. In October, sales of the Ford Transit grew eight percent to 4,519 wholesale vehicles.

The Chinese company will warehouse and distribute Doublestar brand medium-sized steel radial heavy-duty truck tires from the Del-Nat Tire Corp. facilities in South Memphis.

A partnership agreement between the two companies was announced this morning in Memphis by Bing Liangguang, vice general manager of Doublestar Group Inc. and general manager of Doublestar Tire Inc., and Jim Mayfield, president of Del-Nat Tire.

Doublestar is the world’s 21st-largest tire maker and a leading international producer of shoes and other products.

Del-Nat Tire is the result of the 1989 merger of Delta Tire Corp. and National Tire Corp., two leading distributors of private-label tires.

The company operates a 486,000-square-foot distribution facility at 2365 Texas Drive in the Memphis Foreign-Trade Zone.

“The tire business is truly an international industry, with products sourced, produced and distributed by companies from around the world to locations around the world,” Mayfield said in a statement.

“We are pleased that Del-Nat and our headquarters city of Memphis have been selected for the North American hub by this major international company.”

Officials indicated that additional opportunities in private label tire production and distribution between the two organizations are possible in the future.

“We hope this warehousing and logistics partnership with Doublestar is just the beginning of a growing business relationship for products and services,” Mayfield said. “We also hope this presents an opportunity for Memphis to establish itself within this major global production company for additional product distribution opportunities.”

China is a leading supplier of tires distributed by Del-Nat.

In 2009, Mayfield emerged as one of the leading critics of tariffs imposed by the Obama administration on Chinese tire imports.

Del-Nat, owned by 75 independent tire dealers, has annual sales exceeding $200 million. It offers four brands of tires: Delta, National, Chaparral and AKURET.

Rainey He, Fan Guo Xian and Andy Yan of Chang’an Ford FRD Team qualified in three positions behind, which will be the main threat for Lo’s fight for the drivers’ Championship.

Shanghai VW 333 Racing’s drivers Wang Rue, Guo Hua Yang and Sun Chao qualified seventh, tenth and 11th places, with the team having already won the teams’ Championship in the Super Production Turbo (SPT) class.

A few new teams are also taking part in the Super Production Turbo class at the final round. Ren Jie of Shanghai FRC Racing drove the team’s latest car – the new Nissan Tiida Turbo, and qualified 20th. While Kenneth Look and Huang Chu Han, recruited by Shu Cui Ying Galaxy Racing (running two Chevrolet Cruze 1.6Ts) qualified 17th and 21st.

The Super Production race will be held on Sunday at 13:33 local time.

Developing facilities to produce vehicles in the country is one of Volvo’s strongest tools to recover and compete with other manufacturers for Chinese consumers. Volvo has invested $11 million in expanding its operations over the next five years. According to Mr. Li, those funds will be used to release new luxury models.

At this September’s Frankfurt Motor Show, Volvo showed off the You concept (pictured above), which it introduced as a leading, competitive luxury sedan. The You will replace the S80 to become the brand’s most expensive model and directly compete with the BMW 5 Series and Mercedes E-Class.

At the floor of this year’s 9th Annual China Automotive Industry Forum held at the China Europe International Business School, Senior Vice President and Board Chairman for Volvo Cars’ China department Shen Hui said that the manufacturer hopes to use the Chinese market to springboard its global recovery. “In the upcoming five years, Volvo Cars’ sales in China will reach 200,000 vehicles,” Mr. Shen said. China has already become the manufacturer’s third largest market, with its sales in the first three quarters of this year amounting to 33,000 vehicles.

Volvo’s new Shanghai R&D center will be a driving force behind the manufacturer’s global strategy. The 306 acre site began operation earlier this week, and there are construction plans for a new technology building, design center, engine testing room and wind tunnel in the works. The new C30 pure electric (pictured below) will reportedly be developed at the site.

The 2011 China (Macau) International Automobile Exposition highlighted indigenous brand cars brought by 18 domestic manufacturers including FAW Group, Dongfeng Motor Corp, Guangzhou Automobile Group Co and Geely Automobile Co.

It was the first time Chinese automakers had participated an auto show outside the mainland in such a large scale.

Ren Hongbin, chairman of China National Machinery Industry Corp (Sinomach), one of the hosts of the exhibition, said that the company has long wanted to showcase domestic car brands and their latest achievements outside the mainland.

Sinomach is the country’s leading automobile trade and service company and also the organizer of the Beijing auto show.

Their wish came true with the Macao auto show, a new window for Chinese automobile industry to be known to the world, Ren said.

With the geographic advantage of Macao, the exhibition was expected to form a bridge between Chinese carmakers and overseas markets, especially Southeast Asian and Portuguese-speaking countries, he added.

FAW Group, one of the leading domestic carmakers in China, brought 10 vehicles and two powertrains to the exhibition and had the largest booth.

Its displays included Besturn, Vita and Xiali cars as well as the premium Hongqi (or Red Flag) limousine. The company’s two concept cars – the B9 and GO – as well as its self-developed hybrid and electric vehicles were also on stage.

Domestic carmaker Geely had eight models on the show under its three nameplates – the Emgrand, Gleagle and Englon. Due to its acquisition of Swedish automaker Volvo, Geely gained more fame in Macao and attracted many local visitors to its booth.

Guangzhou Automobile Group brought is Trumpchi sedans to the exhibition.

China became the world’s largest auto market since 2009. Last year vehicle production and sales in the country have both exceeded 18 million units. Yet analysts noted that the industry needs to be stronger and bigger, and competitive Chinese homegrown brands are the key.

The exhibition also featured venues exhibiting auto parts and accessories, imported vehicles and luxury supercars.

It had a special collection of old vehicles that were used by diplomats and heads of state.

According to the organizers, about 360 exhibitors from 10 countries and regions joined the exhibition that covered an area of 51,000 square meters. About 100,000 visitors attended the three-day exhibition.

A forum on the topic of “China manufacturing internationalization” was held on the first day of the exposition, with delegates from governments and companies.

Auto exports by Chinese automakers continue to recover this year from a trough during the global financial crisis in 2008. The China Association of Automobile Manufacturers estimates that full-year exports will likely surpass 800,000 units this year.

But exports are still a small portion of the country’s output. Last year, 18 million vehicles were produced in the country while exports totaled fewer than 600,000 units.

Analysts said that Chinese automakers still have considerable room for growth in overseas shipment.

The exhibition was co-hosted by the Macau Convention & Exhibition Association, Nam Kwong (Group) Co Ltd and Sinomach.