Huachen Automotive Group, parent company of Hong Kong-listed Brilliance China Auto, said it plans to spend 3 billion yuan on new car development this year to expand at home and abroad.
The group, which operates a joint venture with German premium carmaker BMW through the listed unit, plans to develop three new models under its own brand a subcompact, a compact and a wagon, Huachen Chairman Qi Yumin told China Daily.
Asked whether it will inject more assets into Brilliance as part of efforts to raise the money, Qi said: "I cannot talk about that now. We'll have various channels."
He vowed the group will regain profit this year by expanding sales considerably.
Huachen aims to boost its sales to 300,000 vehicles this year from 210,100 units in 2006, Qi said. Meanwhile, it expects to lift its sales revenue by 41 percent to 45 billion yuan.
In the first two months of this year, the group's sales rocketed by 138.8 percent to 42,700 vehicles much higher than the 25-percent growth in the entire Chinese auto market during the same period.
Based in the northeastern city of Shenyang, Huachen has been in the red in past years because of sluggish sales and price wars.
Qi didn't reveal how much his company lost last year. Brilliance reported half-year losses of 113.6 million yuan in 2006. It ended at HK$2 per share yesterday, down 0.98 percent.
Huachen's current own-brands include Zhonghua sedans, Jinbei and Granse vans and Jinbei light-duty trucks.
Qi said the group is in talks with a US firm to ship its cars to North America, the world's biggest and most competitive vehicle market. But he declined to provide the details.
North America has also been targeted by many of Huachen's Chinese peers, such as Chery, Geely and Chang'an.
In November, the group cut a deal with a German auto trader to sell 158,000 Zhonghua sedans in Europe by 2011, the biggest overseas deal pulled off by a Chinese automaker.
The company displayed the Zhonghua Zunchi and Junjie sedans and the newly developed M3 sports car to lure European buyers during the Geneva motor show that closed on Sunday, making it the first Chinese automaker to take part in the annual event.
A Huachen spokesperson said the company is also in talks to build assembly plants in Russia, Iran and Malaysia. It now has three plants in Egypt, Vietnam and the Democratic People's Republic of Korea to build the Zhonghua sedans and Jinbei vans and trucks.
The group said earlier this month that it aims to raise its overseas sales to 35,000 vehicles this year from 6,500 units last year. Its venture with BMW is making the German company's 3 and 5 Series sedans in Shenyang.
(China Daily March 20, 2007)