GAC Motor targeting 1M unit sales by 2020, 20% new energy vehicles; entering US market by 2019; transition to electric “may be quite long”
19 June 2017
GAC Motor was one of the few automakers, and the only Chinese auto brand, to take the main stage at last week’s Michelin Movin’On 2017 global sustainable mobility summit in Montreal. During his talk, Yu Jun, president of GAC Motor, said that his rapidly growing company is targeting sales of 1 million units annually by 2020, with 20% of those being new energy vehicles.
Yu said that GAC plans to introduce seven new energy vehicle models—including both electric and hybrid plug-in designs—to the market this year. GAC has already established its first North America R&D Center in Silicon Valley, and plans to to enter the US market no later than 2019.
As the fastest growing Chinese automaker, GAC Motor has achieved 85% compound annual growth rate for six consecutive years. In the first five months of 2017, GAC Motor has already blown past previous records with 207,000 cars sold, marking a 62.2% year-on-year increase. The company has produced 1 million cars in the six years since its first model was launched. The company, said Yu, is targeting 500,000 units this year.
These achievements have been made partly due to our efforts and partly thanks to the choice of the market. We always had great respect and appreciation for this market. Therefore, we shouldn’t be too complacent. As Mr. Deng Xiaoping said, we are crossing the river by feeling the stones. In the area of new energy, the best practice is not to prescribe one certain formula. Enterprises should experiment and explore different pathways. The coexistence of many pathways might be the best choice now. It shall be up to the market.
Future transportation modes will be essentially be electric. However, will such a mode be BEV or FCV or both? It is difficult and unnecessary for us to give an answer now. Moreover, the transition period from conventional power to full electric power may be quite long.
One one hand, for both FCV and BEV, popularity is much lower than expected. I can still recall when some car manufacturer predicted the world would enter the age of hydrogen fuel. But how large are the sales of FCVs even in 2017? The situation for BEV seems better. But in China, without the supporting measures to limit the purchase and use of conventional vehicles and the high subsidies to purchase NEVs, consumers are still reluctant to buy electric cars. A market that survives on compulsory government policies will not be a sustainable one.
Fossil fuels may still last for a long time, Yu noted. In addition to oil reserves and shale oil, he said, China has made great progress in methane hydrate extraction.
The company is expanding a global automotive R&D network supported by the company’s technology center, top global suppliers and research institutes.
GAC Motor has already established a presence in the Middle East by introducing its signature models including the GS8 and the GA8 as an initial stage of entering the global markets and is adding more distribution channels to top markets.
GAC Motor has signed strategic partnerships with the world’s top 10 auto suppliers, including Michelin, Aisin Seiki, Continental and Faurecia. By expanding its footprint along the Belt and Road Initiative countries as well as European and US markets, according to Yu, GAC Motor will create a high-end brand image to enter the global market as a world-class automaker that excels in research, manufacturing and sales.
The company now has established a global sales and service network covering 14 countries. It also launched its talent program to gather top talent in the fields of engineering and technology research and development, marketing and communications and management.