FAW Cars throws 1.79 billion yuan to develop red flag series

FAW Car announced a major investment announcement yesterday. Among them, FAW Car will invest 1.79 billion yuan for the development of the red flag series models. After the development of Pentium's own-brand cars, FAW Car hopes to increase investment to revitalize the Red Flag brand and implement a strategic layout that fully covers the mid-to-high-class car market.

According to the announcement, the FAW Car Board reviewed and approved the "Proposal on Investing in H Platform C131 Project", "Proposal on Investing in Independent Engine 4GC Project" and "Proposal on Investment in Stamping Capacity Improving Project".

The total investment of the H-platform C131 project (red flag series models) is 1.785 billion yuan. The newly increased construction investment of 1.75 billion yuan and the initial working capital of 36.11 million yuan are raised by the company itself. According to the investment economic analysis, the internal rate of return of the project is 13.76%, and the investment recovery period is 7.63 years.

The project will build a new welding production line, renovate the original coating production line and the existing assembly production line on the basis of the original plant, and add new equipment and tooling, so that the company will reach an annual output of 30,000 new C131 models in 2013.

FAW Car believes that the competition in the high-class sedan market is fierce. The high-end models of joint-venture brands occupy the dominant position in the market, and the Hongqi brand needs to use the popularity of the brand to enhance the appeal of the products in the terminal market. The company will cut the market for a reasonable choice of products. Point, improve marketing methods and improve service network. The project will help FAW Car Corporation to comprehensively cover the strategic layout of the mid-to-high-class car market, at the same time, it will help enhance the influence of the Hongqi brand sedan in the market and will enhance the company's profitability. In the investment in autonomous engine 4GC project, FAW Car will invest 699 million yuan to enable the company to have an annual output of 70,000 units of 4GC engines.

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Looking forward to the red flag overturning

As the flagship brand that carries the important responsibility of independent research and development of China's autos, the Hongqi sedan has been greatly disappointed in the “overseas background” of its products in recent years.

From the "little red flag" born on the Audi C3 platform (Audi 100) to the red flag flagship built on the Ford Lincoln Towncar platform to the red flag prosperity developed on the Toyota Crown Majesta platform, apart from the poor market performance, FAW also The pressure of public opinion that "technology depends on foreign countries" has been under pressure.

At the same time, a few years ago, "self-owned brands need to withstand loneliness for 20 years," the position has also been widely questioned by the industry.

Therefore, FAW's self-developed vehicle, the Hongqi C131, has become the most important product for FAW's "Fame Name."