The removal of foreign automobile brands from the People’s Liberation Army’s (PLA) procurement list may substantially help out Chinese vehicle producers’ domestic car brands.
The China Daily reported that the PLA has taken delivery of more than 1,000 FAW Hongqi H7 sedans , also known as Red Flags, to the PLA General Armament Department for official use so far this month. These vehicles replaced the Audi, Passat and Santana cars made by local joint ventures with German brands, The China Daily said.
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The report said the move followed the military’s procurement of Trumpchi GA5 models, developed by GAC Motor Co Ltd, as well as the Besturn B90, made by FAW Car Co Ltd, earlier this year.
The report also said that the military department has invited only FAW Car, GAC Motor, SAIC Group, Brilliance Auto Group Co and BAIC Motor Co to bid for the official vehicles procurement.
Cheng Guhui, an official with the department, was quoted as saying that “choosing self-developed automobiles is a strict but basic standard in military vehicle reform”.
Analysts said that the military’s purchase of more than 1,000 Hongqi H7 sedans, which was launched last May with a price tag of from 299,800 to 479,800 yuan ($48,000-$77,000), would give a big boost to FAW’s revival plans for the iconic Hongqi brand.
Company statistics showed that FAW delivered no more than 3,000 Hongqi sedans last year, the report said.
Domestic brands in China have been under pressure in the Chinese market from Western brands made by joint ventures in China who have been grabbing share.
The political mood in China has changed over the past eighteen months as Beijing has sought to clamp down on corruption and take measures to spread wealth more evenly through the country and society.
