Major Chinese auto group Chongqing Changan Auto Co <000625.SZ> is planning acquisitions overseas as it prepares to enter Europe and North America where the industry downturn has hit hard, its chairman said on Sunday.
The longer the crisis lasts, the bigger the chance of failure or a scale-down of some American and European automakers, Xu Liuping told reporters on the sidelines of a news conference.
And that has provided a chance for entry by Chinese manufacturers.
Changan, Ford Motor's
Asked about progress on a possible Volvo deal, Xu declined to comment, citing disclosure rules mandated by the Chinese securities regulator.
We are actively pursuing mergers and acquisitions at home and overseas but have not reached any deal so far.
Changan is among the growing ranks of Chinese automakers, including Chery Automobile, that hope to emulate the global success of their Asia rivals.
The firm said in February it had signed a framework agreement with Autopark Mexico to start making cars in Mexico next year, with an initial capacity of 50,000 units.
Xu said Changan could sell cars to North America from Mexico, its sixth overseas assembly line, in the future, but he did not give a timetable.
Changan, China's fourth-biggest auto maker, said it sold 306,500 vehicles in the first quarter, up 13 percent from a year earlier. The strong demand for its mini vans and compact cars helped it contribute to a 3.88 percent first-quarter growth for the country's overall vehicle market.
The firm, which will unveil its first mid-to-higher end concept sedan, the CD101, at the Shanghai autoshow on Monday, aims to sell 2 million vehicles annually by 2012, Xu and other executives said.
Its sales came to 861,377 vehicles in 2008, according to data provided by China's official auto association.
To achieve the target, Changan will launch more than 15 self-developed new models, including more than 10 cars in the next 3 to 5 years, according to its general manager, Zhang Baolin.
It also plans to invest 20 billion yuan ($2.93 billion) by 2012 to build a development and manufacturing base for engines, including engines for clean energy vehicles, executives said.
The company will start selling hybrid vehicles to retail buyers later this year and aims to sell more than 10,000 hybrid vehicles in next two years, they added.
(Editing by Sanjeev Miglani)