Chery to reduce product projects by 90%

Chery is currently working on streamlining their overall strategy by decreasing the number of projects for their model range, caixin.com reported, quoting a statement made by manufacturer Board Chairman Yin Yuetong. According to Mr. Yin, Chery plans to cut said projects by 90 percent.

In a summit held in Beijing late last week, Mr. Yin attributed domestic own brand manufacturers' poor performance last year to the phasing out of preferential government policies and 'ignorant arrogance' on the part of certain companies. According to statistics collected by the China Association of Automobile Manufacturers, domestic manufacturers managed to sell a total of 6.11 million vehicles in 2011, falling 2.56 percent from the previous year. They also lost 3.37 percent in market share to foreign competitors.

According to Mr. Yin, Chery is in the process of making a major shift in its overall strategy. In May 2010, Chery held a three day long summit with the goal of deciding which direction the manufacturer wants to go and how best to maintain development. Following the summit, the manufacturer settled on reducing the number of projects it was undertaking. In the past Chery was dividing its resources among 130 plus individual research and development projects, that number has since decreased to just over 30.

"Reducing the number of product projects is the result of [this] strategy," Mr. Yin stated. Even if doing so may cause short-term harm, he emphasized that the manufacturer is still committed to the plan.

In addition, the manufacturer will aim to unify manpower, as well as financial and material resources, in order to better accommodate market needs, Mr. Yin said.

Chery, which was established in 1997, is one of China's most well known own brand manufacturers. The manufacturer sold a total of 640,000 vehicles last year, and officially agreed to establish a joint venture with British Jaguar Land Rover last month.