China car slump may end weakest brands

FRANKFURT • China’s slowing car market may spell the end for some of the country’s worst-performing manufacturers, said the head of one of the biggest state-run automakers.

The sales decline is set to trigger consolidation among local automakers and the disappearance of certain brands, Beijing Automotive Group Co chairman Xu Heyi told reporters at the Geneva auto show yesterday.

“Some weaker ones might be gone,” said Xu, who’s also chairman of BAIC Motor Corp, the Chinese partner of Daimler AG. Increasing cost pressures will lead to more cooperation among automakers and parts suppliers, he said.

Separately, Xu said Tesla Inc is set to have a “very big impact” on China’s new-energy vehicle sector when it begins production there, and that Zhejiang Geely Holding Group Co Ltd’s ties with Daimler haven’t hurt BAIC’s relationship with the maker of Mercedes-Benz cars.

So far, demand for luxury vehicles from BMW or Daimler’s Mercedes-Benz have been less affected by the downturn than local mass-market nameplates.

BAIC showed the battery-powered Arcfox-GT high-performance car in Geneva and a design concept for an SUV. Both will go on sale in Europe as early as next year, Xu said.

There’s no plan to enter the US market, he said. — Bloomberg