Foton Philippines plant will extend international reach

Updated: 2011-12-19 07:55

By Xiao Han (China Daily)

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 Foton Philippines plant will extend international reach

Foton has high expectations that its Tunland pickup will lead the charge in developing markets. Provided to China Daily

BEIJING - China's leading commercial vehicle maker Beiqi Foton Motor Co will invest $20 million in a new plant in the Philippines to assemble vehicles for Southeast Asian markets, according to the Philippines Star newspaper.

Foton's Philippine branch and Clark Development Corp recently signed a 25-year renewable lease on 50,000 square meters of land for the assembly facility, the report said.

The property is part of the former Clark Air Base, a sprawling 4,500-hectare US military site dating back to 1901 that was transferred to the Philippine government in 1991.

Foton will invest $20 million over the next three years in the plant, which will employ at least 120 workers in the initial stage, it said.

The automaker entered the Philippines in 2006 and now has 14 dealerships - selling trucks, pickups and vans - and more than 60 repair shops.

Foton is making intensive moves overseas this year after it announced an ambitious plan last year to sell 4 million vehicles annually by 2020, more a fourth of them abroad.

Reaching the goal will require bold expansion in the next decade - the automaker sold just 680,000 vehicles last year with fewer than 20,000 delivered in overseas markets.

Foton said in a statement last month that it will set up sales companies in Kenya, Indonesia and Australia.

The company plans to invest $2.18 million to form a subsidiary in Kenya to increase brand awareness and after-sales services in the east Africa. It broke ground in April on a plant in Kenya that will go into operation next year assembling fully knocked down vehicles

In Indonesia, it plans to invest $2.4 million in a new subsidiary, while in Australia it will spend $2 million to connect with local customers.

The automaker also plans to build a plant in India that is scheduled to begin production in the middle of 2013 with designed output of 120,000 vehicles a year.

The first product in Foton's global strategy is its Tunland pickup that debuted at the end of October in Beijing, home to the company's headquarters.

The model will hit the markets in South Africa, Australia, Chile, Saudi Arabia and Malaysia at the end of the year.

In 2020, the company expects to sell 260,000 pickup trucks overseas due to projected strong demand, especially in developing countries.

In September, Foton got a green light from the government to set up a joint venture with Daimler AG to build and sell medium and heavy-duty trucks. Analysts said the partnership will also help Foton gain a bigger presence in international markets.

China Daily

(China Daily 12/19/2011 page18)