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Geely set for control of London taxi maker
China\’s Geely Group is set to increase its grip on lossmaking London black cab taxi maker Manganese Bronze by taking a controlling stake and moving more of the production of the TX4 cab to China.
Geely, China\’s largest privately owned car maker, is also in talks to buy Ford\’s Swedish unit Volvo — another of Europe\’s venerable motoring names.

A London taxi crosses Waterloo Bridge in London on July 29, 2009.? [Agencies]
Manganese Bronze said on Wednesday it was considering a placing of new shares with 20 percent shareholder Geely at 70 pence per share to give the group a controlling stake, and announced plans to shift production of bodies and chassis for the TX4 from its Coventry plant in central England to Shanghai.
The company said the share placing would give Geely at least a 51 percent stake in the group, which had a market capitalisation on Wednesday of just under 26 million pounds ($40 million).
"This is a bit of a turning point for us," Manganese Bronze\’s chief executive John Russell told Reuters after the group reported a pretax loss in 2009 of 7.3 million pounds.
"Seeing the immediate benefits of our relationship with Geely coming through in the TX4 we are now at a point where we can think about building a closer relationship with our Chinese partner."
Hong Kong-listed Geely Autombile has not made a decision on whether to increase its stake in Manganese Bronze yet, a company executive told Reuters.
Cab wars
The black cabs that Manganese is now making in China are traditionally associated with London, where licensed drivers must pass a test known as \’the knowledge\’ to show they know all the roads, landmarks and places of interest within a six-mile radius of Charing Cross station.
Competition in the market, once controlled by Manganese\’s TX series of vehicles, has heated up over the last 18 months with the entry of the Mercedes Vito model, distributed by Eco City Vehicles.
Eco City has since grabbed a 30 percent slice of the market and in direct contrast to its rival has announced plans to increase production in Coventry and hire more people to meet demand.
Manganese Bronze, which halted dividend payouts in 2008, said on Wednesday that shifting body and chassis production to Shanghai would result in cutting around 60 jobs in Coventry but the TX4 cab would continue to be assembled in England. Manganese said it has already reduced its workforce to around 359 from a peak of around 500 employees before the recession began.

Analysts at Collins Stewart said Geely had come to the rescue of Manganese Bronze, which has struggled with radiator problems, discounting and falling market share.
"Such a move (a placing) would effectively bring in 14 million pounds ($21.50 million) of cash and reduce the group\’s dependency on stocking loans as a source of capital," they said.
London-born driver Brian, who has been a cabbie for 17 years, said greater overseas control could mean lower quality parts and therefore more reliability issues, noting how cabs no longer carry a "Made in Coventry with pride" sign.
"We\’re their bread and butter but they treat us like the dirt on their shoes," he said, showing a Reuters reporter a sheaf of repair bills and rust spots on his cab, which is only five years old.
The firm said in response it would never use any parts that didn\’t pass strict UK regulations, or their even more stringent internal standards.
Shares in Manganese Bronze, which have lost almost a quarter of their value so far this year, were down 0.6 percent at 85 pence at 1310 GMT, far below the high of over 950 pence achieved in May 2007.

Mercedes\’ domestic sales to outdo UK
Mercedes-Benz believes its strong market success in China comes from the German carmaker\’s ability to assimilate the trends and demands of the local market.
That strategy has been key to zipping ahead in China\’s fiercely competitive and dynamic automobile market, according to Klaus Maier, president and CEO of Mercedes-Benz (China) Ltd.
Just last month, his company posted record year-on-year growth of 160 percent in China, far outpacing Audi\’s 62 percent growth and BMW\’s 97 percent.
Maier credits the company\’s success in China to a comprehensive understanding of the market.
By all accounts, the strategy has served the Stuttgart-based company well. In the first two months of 2010 alone, for instance, it enjoyed vehicle sales of more than 15,300 units.
This translates, on average, to approximately 7,500 units per month thus far in 2010 – compared with the company\’s typical delivery of 5,500 in 2009.
Mercedes executives see this as a long-term trend on the mainland. "Our successful efforts in formulating such a localized strategy have provided us with increasing and validated confidence looking forward, as we expect to continue growing at a higher rate than our competitors, as well as the overall and luxury auto market in 2010," said Maier.
This is expected to have global implications for product sales. This year, added Maier, "we expect China to overtake the UK to become our third largest market worldwide".
Knowledge of the Chinese marketplace, in terms of economics and demographics, and adapting sales and marketing activities to the fast changing environment has made Mercedes the top brand among China\’s growing numbers of wealthy people.
Mercedes-Benz, for example, has long been straddled with a "Big Benz" reputation – an automaker dedicated to bigger, more traditional luxury cars.
Following studies of the Chinese market, however, "we have made a point to diversify our product portfolio – even introducing China-specific models – to reflect market demand", said Maier. "Supported by enhanced marketing activities the Mercedes brand has broadened its image, and is more identifiable to a much wider customer base."
Quick to realize the trend for entry-level models with smaller engine sizes, the German-luxury brand launched a wide range of products with 3.0 liter or less-sized engines last year, including its B-Class and smart car.
"The reason for this, in part, lies in the recognition of our younger audience with an average age below 40-years-old, which has the majority of purchasing power in the country," said Maier.
Mercedes\’ German rival BMW has also realized that its customers in China are younger and more discerning. Introducing smaller and more diversified vehicles appeals to a younger, lifestyle-oriented audience.
BMW launched its 1-series hatchback in China in 2008, and launched its smallest SUV, the X1, this January.
Catering to China\’s growing interest in a greener society, two hybrid models were also included in the luxury carmaker\’s local product launch this year.
Mercedes-Benz has also taken at first-hand look at the environmental damage accompanying China\’s breakneck industrialization.

Not surprisingly, the automaker introduced a wide range of environmentally compatible models, including the S400 HYBRID – a hybrid vehicle with a lithium-ion battery – and the fuel efficient E-Class, with its low carbon emissions, in line with customers\’ increasing desire for eco-friendly mobility.
"Mercedes Benz has carefully crafted it\’s formula for success in a business environment that can prove challenging to all carmakers," said Bjoern Hauber, vice-president of sales and marketing of Mercedes-Benz (China) Ltd. "Later this year, we will continue to expand our product portfolio, and introduce even more eco-friendly products to lead the market trend."
Additionally, Mercedes SLS AMG – an alluring sports car characterized by its dynamic performance, purist design, lightweight construction and outstanding handling – is scheduled to enter China in 2010.??

Cnooc may snag 50% of Argentine oil producer
CNOOC Ltd, China\’s largest offshore oil and gas producer, said on Sunday it will pay $3.1 billion to acquire a 50 percent stake in Argentine oil producer Bridas Corp, a deal analysts said will add to the company\’s reserves and production substantially.
"It is not only significant as a positive, long-term business strategy, but also will serve to add substantially to CNOOC\’s production and reserves immediately," said Frank Gong, vice-chairman of China investment banking at JP Morgan. The company is the sole financial adviser to CNOOC in the deal.
Based on 2009 statistics, the deal would increase CNOOC\’s proven reserves and average daily production by 318 million barrels of oil equivalent (BOE) and 46,000 BOE respectively, said a company statement.
"Bridas, with a world-class oil and gas asset portfolio, is a very good beachhead for us to enter Latin America. Through this transaction, we\’ll establish a fair presence in this region," said Yang Hua, president of CNOOC.
Currently, Bridas, through its affiliates, has oil and gas exploration and production activities in Argentina, Bolivia and Chile.
Latin America is one of the foremost growth areas in the global oil and gas business. Bridas is among the top players in the region on various fronts, including reserve additions, production growth, and low cost operations, said analysts.

Bridas itself has huge upside potential. Energy demand in Argentina is growing rapidly and the regulatory environment is evolving favorably. In addition, there are distinct growth opportunities arising from the exploration portfolio and from increased recovery rates, they said.
It has been some time since CNOOC made its last overseas acquisition, said Liu Gu, an analyst at Guotai Junan Securities.
"The deal confirms with CNOOC\’s future strategy to focus more on deep-water oil exploration and overseas expansion," said Qiu Xiaofeng, an analyst at China Merchants Securities in Shanghai, adding that the company will see accelerated growth in its overseas expansion between 2011-2015.
The deal still needs the approval of the Chinese government, and is expected to take place in the first half of 2010, according to CNOOC.

Google to \’bear consequences\’
Google "will bear the consequences" if it stops censoring search results on its Chinese website, the Ministry of Industry and Information Technology (MIIT) said on Friday.
The statement by Minister Li Yizhong at a press conference was the strongest one yet by the Chinese government over the issue since Jan 12, when the US-based Internet search giant threatened to pull out of China because of cyber attacks that it claimed originated from the country.
The Chinese government welcomes Google to expand its market share in the country if it abides by Chinese laws and regulations, Li said.
But when reporters asked him what China would do if Google stops censoring search results on its local website, Li, 65, said: "If you don\’t respect Chinese laws, you are unfriendly and irresponsible, and you will bear the consequences."
Google has been in negotiations with Chinese authorities over providing unfiltered online services since its announcement two months ago of the alleged cyber attacks and its unwillingness to continue censoring its search results on domestic website Google.cn.
But talks between the Chinese authorities and Google have made little headway, with MIIT Vice-Minister Miao Wei telling reporters earlier that there has not been any "direct contact" with the search engine.
Google was reportedly planning to stop censorship of its search results on its Chinese website within weeks, the Wall Street Journal on Wednesday cited an unnamed source as saying. The report came shortly after Google CEO Eric Schmidt said he expected his company to reach a conclusion soon in its talks with the Chinese government.
Google may end up making individual agreements with different Chinese agencies to allow it to operate some parts of its business in a patchwork arrangement, the newspaper reported.
Li on Friday did not confirm if his ministry was in talks with Google.
Still, he said Google has "done a good job" by taking up 30 percent of China\’s search engine market since it entered the country in 2007.
"If Google chooses to stay, that will be beneficial to China\’s Internet market and we welcome that," Li said.
But China respects Google\’s rights if it decides to pull out of the country and the country\’s online market will continue to grow with or without Google, he said.
Google established a joint venture in China in 2007 and launched its domestic website Google.cn. The domestic website accepts the government\’s requirement to censor some of the content such as political issues and pornography.
Such content needs to be regulated by the government, according to current Chinese laws and regulations.
The country\’s Internet market is open and government regulation of it is in line with international practices, Li said.

Quality watchdog starts HP investigation
An investigation has been launched following complaints about faulty Hewlett-Packard laptops, an official from the General Administration of Quality Supervision, Inspection and Quarantine, China\’s quality control watchdog said, xinhuanet.com reported today.
The agency said complaints over the quality of HP laptops from 60 customers have been received.
As of March 10, on a nonprofit website in China, more than 1,400 consumers had expressed their willingness to take part in a group complaint against HP over faulty laptop computers and more than 80 lawyers offered help in the case, another report on xinhuanet.com said on Friday.
On March 5, the website filed an official complaint against HP to the General Administration of Quality Supervision, Inspection and Quarantine. Within five days more than 200 consumers had officially joined the protest group.
The complaint centered on video cards that overheated and caused the laptop to malfunction. The complaints asked the quality watchdog to launch an investigation into HP laptops, hoping the government would order the company to have the faulty goods returned or replaced with new ones, and provide compensation. It was also suggested that government issued orders to launch a recall on all the faulty computers.
An unofficial alliance of more than 3,000 consumers in approximately 40 online chat groups has formed to defend their rights in the HP case before World Consumer Rights Day on March 15, according to the Friday report.

AVIC to develop new energy in northeast

Aviation Industry Corporation of China will invest 3.3 billion yuan ($483.9 million) to develop new energy enterprises in China\’s northeast, the company said Monday.
The State-owned company said it would build wind power stations of 200,000 kilowatts (kW), natural gas power stations of 100,000 kW and solar power stations of 40,000 kW installed capacity in the city of Da\’an, Jilin province, northeast China, according to the pact the company signed Monday with the local government.

The waste heat of the natural gas power stations would also be used to warm houses, the company said.
Da\’an, located in the northwest of Jilin province, is rich in natural gas, and has a good environment for wind and solar power generation. According to the official website of Da\’an municipal government, the city has access to natural gas deposits of about 2 billion cubic meters, and its average time of sunshine totalled 3,013 hours per year.
The Chinese government has vowed to cut carbon dioxide emissions per unit of the GDP by 40 percent to 45 percent by 2020 from the 2005 level, which represents a reduction of roughly 1.5 billion tons of emissions.
The government has promised to subsidize new energy companies as well as giving them other incentives to achieve the reduction, said Finance Minister Xie Xuren in the Central Economic Work Conference held last month.

Southeast Motor to recall 734 CVT vehicles
China\’s quality watchdog said Monday that Fujian-based Southeast Motor Co will recall 734 CVT vehicles due to safety problems on the Chinese mainland as of Feb 3.
The recall is due to gear safety faults caused by improper manufacturing techniques, the General Administration of Quality Supervision, Inspection and Quarantine (GAQSIQ) said in an online statement Monday.
The GAQSIQ said in the statement the recall involved CVT models produced from Nov 17 to Dec 15 last year, and the manufacturer would fix the problems for free.
Owners can contact Southeast Motor by phone on 800-858-1666 or contact the GAQSIQ on 86-10-65537365.

Top-selling Audi plans yet more capacity
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New car showroom: Audi has 160 authorized dealerships in 95 cities, the biggest sales network among all premium car brands in China. It has announced plans to increase the number to more than 210 by 2012. [China Daily]
Icon that defines status in China says sales to grow at least 25%
German luxury carmaker Audi, owned by Volkswagen Group, plans to build additional production capacity in China to meet mounting demand in the world\’s biggest vehicle market.
Johannes Thammer, general manager of the Audi sales division at Sino-German joint venture FAW Volkswagen Automobile Co, said last week in an interview that Audi has plans to further expand capacity in China to meet its target of selling 250,000 cars annually by 2012 or 2013.
Audi\’s 2009 China sales surged by 33 percent to 157,188 vehicles over the year previous, easily maintaining its long reign over the country\’s premium car segment.
The strong growth made China the company\’s second-biggest market in the world after Germany, where it moved 228,844 units last year.
"We will not allow production capacity to be a bottleneck for our sales growth," Thammer said "We need to increase production capacity every year to keep pace with our sales momentum."
He said FAW Volkswagen plans to expand overall production capacity from 660,000 units to 1 million units a year in the near future, with Audi a part of the expansion.
The company opened a new 100,000-unit facility last September in northeastern city of Changchun that raised its total production capacity in China to 200,000 units annually.
"Success in China will be an important part of Audi\’s goal to be the most successful premium car brand globally in 2015," Thammer said.
Arch-rivals BMW and Mercedes-Benz are also in the race to expand production in China to further tap the local luxury car market.
BMW announced in November that it plans to increase capacity in China to 300,000 units a year over the long term from the 41,000 cars it made last year. Its production this year will rise to 75,000 units.
Mercedes-Benz also has long-term plans to lift capacity to 75,000 to 100,000 units a year from the 30,000 currently.
Thammer said Audi expects its sales in China to grow by 25 to 30 percent this year from 2009.
"The overall premium segment in China will rise by 25 to 30 percent this year and we want to grow at a similar pace at least," he said.
Last year 392,000 premium cars were sold in China, a surge of 38 percent from 2008, according to data provided by Audi.

Philips lines up $54m investment
Electronics company Royal Philips Electronics yesterday said it would invest $54 million to set up an Industrial Campus for imaging systems in China over the next five years, to cash in on the nation\’s healthcare reforms.
Located in the Suzhou Industrial Park, Jiangsu province and covering 62,000 sq m, the Industrial Campus for imaging systems will have the integrated facilities of R&D, manufacturing, assembly and sourcing in one site.
The campus mainly produces intermediates for the Chinese market and is adapted to the requirements of local hospitals. It will produce 64-slice CT and 1.5T MR machines, which are mainstream imaging systems equipment in most of China\’s provincial and city level hospitals, as well as X-Ray equipment for mid-sized hospitals.
"The move will perfect the current healthcare product lines, and further enhance our healthcare presence in the country," said Steve Rusckowski, executive vice-president and chief executive officer of Philips Healthcare.
Besides the campus, Philips Healthcare has two other sites nationwide that integrate the facilities of R&D and manufacturing, the joint venture with Neusoft and the recently acquired company Shenzhen Goldway. The two sites focus on patient monitoring and home healthcare business respectively.
"The Industrial Campus in Suzhou, together with the other two sites, will make us better positioned to help improve the accessibility and affordability of healthcare services in China with a complete product portfolio that serves both the market requirements for the value segment as well as more advanced specialized applications," Rusckowski said.
Earlier this year, the government said it would invest 850 billion yuan over the next three years to revamp the country\’s healthcare system. Nearly one-third of the funds would be used to establish new hospitals or medical service centers, and upgrade existing healthcare facilities.
According to research firm Frost &Sullivan, China\’s medical equipment market revenue touched 83 billion yuan last year, accounting for one-eighth of the country\’s total healthcare industry.
Analysts said the rapid growth of the Chinese healthcare industry and the ongoing medical reform are expected to create huge demand for medical equipment such as X-ray machines, CT scanners and ultrasound scanners.
Healthcare business accounted for nearly 29 percent of Philips\’ overall sales last year and was the second largest contributor to sales.

TCL setting up new LCD production line
Shares of TCL Corp surged to the daily trading limit of 10 percent yesterday, to 4.57 yuan (67 cents), after the appliance and top TV maker said it was setting up a thin film transistor-liquid crystal display (TFT-LCD) production line in alliance with the Shenzhen government.
The new 8.5-generation technology production line would be set up with an investment of nearly 24.5 billion yuan, said company executives.
TCL plans to form a 50-50 joint venture with the Shenzhen government-owned Shenchao Technology Investment Ltd. Both the firms would contribute 5 billion yuan each as registered capital for the venture.
The TV maker is also planning to sell 1.5 billion new shares to 10 specific investors at a price of 3.46 yuan per share through a private placement, to finance the project.

The remaining 14.5 billion yuan will be raised via bank loans and other methods, said Chairman Li Dongsheng.
Construction of the TFT-LCD panel project is scheduled to begin in January and production likely to start in the third quarter of 2011. The new venture is likely to get full returns from its investments in 10 years.
"That is comparatively a long gestation period, even though the 6.23 percent return on investment looks promising," said Zhu Lijun, an analyst with China Galaxy Securities. The main challenge for the venture would be the management\’s ability to cater to the ever-changing market demand.
Zhu said the government subsidies for buying consumer appliances has triggered demand for liquid crystal displays. He expects the demand to continue for three years as most TV sets in the country would be replaced by new ones during the period.
"Domestic TV makers were until now reliant on LCD imports to cater to the growing demand. However, most of these companies are now setting up their own production lines to reduce costs," said Zhu.
But the major stumbling block for most of these firms has been the inability to make the large-size TFT-LCDs. With 60 to 70 percent of the costs going toward import of LCDs, there was hardly any room to make profits, TCL said in a statement.
TCL\’s announcement comes just a few weeks after its foreign rivals disclosed plans to build advanced LCD facilities in China. These include LG Display Co\’s $4 billion 8th-generation joint-venture in Guangzhou, Samsung Electronics Co\’s $2.3 billion 7.5th-generation panel plant in Suzhou, and Sharp Corp\’s 6th-generation plant in Nanjing, reported the Wall Street Journal.