Automotive News EuropePARIS - Citroen's joint venture in China plans to double production of ZX hatchbacks to 60,000 units in 1998. The Dongfeng Citroen Automobile Co. plant in Wuhan will also add a second model, a three-box version of the ZX that will go on sale in late 1998.
Citroen is also considering building a commercial vehicle in China, probably the Berlingo van.
Wuhan's capacity will rise from 40,000 units a year to 90,000 units next year. The eventual goal is 150,000 units. Paint shop capacity will be raised to 180,000, possibly in 1999.
Local content of the ZX - called the Fukang in China - is nearly 80 percent. This has to rise to 97 percent by 2005, according to the joint venture agreement.
'All visible steel parts and several hidden parts' are stamped at Wuhan, said Gilles Robert, Citroen's manager for China operations. Some parts are also stamped at plants owned by Citroen's partner, Dongfeng Motor.
Sheet steel for the stamping plant still comes from France, because steel of the required quality is not yet available from local suppliers. Starting next year Dongfeng Citroen will use steel sheets sourced locally. The company plans to raise stamping capacity by increasing the number of production lines from two to four.
Dongfeng Citroen's engine plant in Xiangfan, 350km from Wuhan, makes 1.4- and 1.6-liter gasoline engines. The same plant will make transmissions starting in 1998.
Robert said that Wuhan is meeting both quality standards and production targets. 'We have not compromised on quality while raising production,' he said. 'Wuhan has the same quality standards as PSA plants in Europe.'
The paint shop's quality targets are set by Sevelnord, the Fiat joint-venture in Valenciennes, France. Aulnay, also in France, is the model for Wuhan's stamping plant, and Vigo, Spain, is the model for the body shop.
Dongfeng Citroen is building up a three-tier sales and service network of more than 400 dealers: 65 offer full service, 120 offer only service and spare parts, and 252 are only retailers.
Only 56 dealers have sold more than 20 cars this year.
Dongfeng Motor has imported around 400 Xantia and XM sedans, which have been sold through a smaller network of 15 dealers.
Citroen expects the Chinese car market to reach 440,000 units in 1997, up from 420,000 in 1996.
Chinese passenger car production, 1997
Volkswagen Santana 220,000
Daihatsu Charade 80,000
Volkswagen Golf/Jetta 40,000
Jeep Wrangler 40,000
Citroen ZX (Fukang) 30,000
(All figures are approximate)