The Chinese are learning fast - the European launch of Brilliance Jinbei shows how the new auto makers from China are starting to understand what's required if they're to succeed in overseas markets. Mark Bursa reports.

At last, a Chinese auto maker that ticks all the boxes. Brilliance Jinbei Automobile made its formal European debut at the Geneva Show - without stupid model names, handouts in amusing 'Chinglish', mad propaganda films - or cars that collapse catastrophically under crash tests.

Instead, we got a glimpse of the three models that the company has already started introducing on mainland Europe - Italian-styled, German engineered and Japanese-engined cars that meet Euro IV standards. And we got to meet the man in charge of European sales - Hans-Ulrich Sachs, an experienced European distributor who launched Hyundai in Germany in 1991 and has worked as a senior brand manager for Volkswagen.

Probably the only negative is the types of cars on offer - large, four-door sedans. Popular in Asia, but less so in Europe - unless they've got a German prestige badge on the grille. And Brilliance, though distinctive, is not a brand indicative of understated class and quality.

So Brilliance may struggle to shift 15,000 of its launch model, a large sedan called the BS6. Sales actually started at the start of the year - the first 3,000 vehicles have been supplied to dealers in Germany, the Netherlands, Austria, Switzerland, and Poland, the first-phase launch markets for the brand.

It's keenly priced for its size, with prices starting at around €19,000. It's styled by Giorgio Giugiaro's ItalDesign, and has ride and handling "optimised" by Porsche. Euro-IV compliant 2-litre, 122bhp and 2.4-litre, 130bhp petrol engines are provided by Mitsubishi.

But even if the BS6 doesn't hit its goals, there are other Brilliance models on the way that are more likely to hit the mid-term target of 75,000 sales across the continent by 2010.

Hans-Ulrich Sachs

BS6 will be followed by two other models also on show at Geneva: the smaller BS4 mid-range saloon, also Giugiaro-designed, and a coupe called BC3. The BS4 is based on a shortened version of the BS6 platform and has a 1.8-litre Mitsubishi engine and five-speed gearbox. The engine comes in turbocharged guise too, coupled to Brilliance's own four-speed automatic gearbox.

The BC3 was styled by Pininfarina and also has a 1.8-litre turbo - but this is Brilliance's own design, developing 170bhp. It also meets Euro IV standards. All these cars were displayed at Geneva. And a diesel engine for BS6 and BS4 will be added by the end of 2007.

Future models include a compact car called BS2 and an SUV - what's the betting this will be called BX5 or BX7? Sales will be confined to mainland Europe at first - right-hand drive production is not scheduled until after 2010, leaving the UK and Ireland out of the sales loop for a while. In any case, European distributor HSO Motors Europe has a task on its hands to meet its targets in Europe - it wants to sell 15,000 of the cars this year.

"The Geneva Show opens the door to Europe for Brilliance," said HSO Motors head Sachs, whose company has an exclusive five-year distribution deal with Brilliance Jinbei. "It represents a huge milestone on the journey to make Chinese cars popular in Europe."

HSO Motors is currently signing up European distributors, including Belgian car supermarket operator Cardoen and France's AsieAuto, which already distributes Chinese Landwind SUVs through a 100-strong network of dealers. HSO plans to handle German sales itself. France, Italy, Spain, Portugal, and Greece represent the second phase of markets, with Norway, Finland, Sweden, Czech Republic, Slovakia, and Hungary on the agenda after that. Brilliance wants 750 European dealers by the end of 2008.

Sachs believes the path to acceptability for Chinese automakers will be much quicker than for the Japanese and Korean manufacturers that entered the European market in the 1970s and 80s. "While the Japanese required approximately 20 years to establish themselves and the Koreans took over ten years, we are entering the market with a very European vehicle," he said, adding that Brilliance will be recognized as a vehicle brand in Europe within "approximately five years".

Sachs is bringing some of his experience at Hyundai to the Brilliance launch, offering long warranties of three years or 100,000km initially, and Sachs hinted he wanted to extend this to "an industry-leading" standard.

Brilliance has other advantages over some of the other upstart Chinese manufacturers such as Chery and Geely, or the SUV-makers such as Changfeng and Great Wall, which also have ambitions on European sales.

Most notable among these is the experience Brilliance has gained of building quality cars - it's BMW's Chinese assembler. It has invested heavily in manufacturing facilities in Shenyang since assembly started in 2003, and will build 20,000 BMW 3- and 5-Series sedans in 2007.

BMW production specialists also advised Brilliance with its own production facilities. Its Shenyang production line was designed by, and its construction was supervised by German automation company Schenck AG of Darmstadt.

"The production facility in Shenyang can compete with any European passenger vehicle production facility", said Sachs. The automation level in some manufacturing areas exceeds 70%, and the plant has manufacturing equipment supplied by leading European companies such as stamping presses from Schuler, welding robots from Kuka, and the paint-spray line from Dürr. European-style barcode systems and quality control checks are employed throughout the production line.

Sachs said he would be passing new technology trends and customer feedback back to the R&D department in Shenyang: "In Europe, we are acting as a technology and innovation seismograph for our Chinese partners," he said.

The company also assembles HiAce vans and Granvia MPVs under licence from Toyota (they're sold under the Jinbei Haice and Granse brands) - another company that sets high manufacturing standards.

The company already has substantial volumes in China. The automaker reported that its 2006 sales rose 71.5% to 210,000 vehicles, of which 8,655 were exported. Production in 2006 was split between 80,000 minivans, 40,000 BS6s, 60,000 light trucks and 20,000 BMWs.

Brilliance is the country's biggest minivan maker, and it aims to sell 230,000 vehicles this year, rising to 310,000 cars by 2010. It employs around 9,100 people. Exports, including sales to the Middle East and Eastern Europe, should reach 27,000 vehicles this year. CKD facilities have been set up in Egypt and Vietnam, and the company is setting up a JV in North Korea to assemble 12,000 Haice minibuses over a five-year period.

Brilliance Jinbei is a public company. It is listed on the Hong Kong Stock Exchange and the New York Stock Exchange, giving it access to funding beyond the reach of some of its rivals.

For the future, Sachs is aiming for a 1% European market share - which would mean doubling that 2010 target of 75,000 sales to around 150,000. "You are successful if you are above 1%," he said. "If you are below 1%, then you are more or less an amateur." He won't go so far as to specify a target date for that 1% target, though.

Brilliance has also started looking at the US for future growth. Sachs said negotiations on a distribution network for the US market had started. "They have made first contacts just recently in the United States, and there is something in the pipeline," he told Reuters at Geneva. Indeed, a big sedan such as the BS6 might be far more suitable for conditions in the US rather than Europe, as it would compete for sales with big US sellers such as the Toyota Camry and Honda Accord.

Mark Bursa

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