Beiqi C70, Based on Saab 9-5, Enters Production This Fall in China

Just the Facts:

• State-owned Beijing Auto, the Chinese partner of Daimler and Hyundai, will begin production in November of its Beiqi C70 sedan, which is based on the platform of the old Saab 9-5.
• The smaller Beiqi C60, based on the previous-generation Saab 9-3, is expected to go into production in 2012.
• Beijing Auto in 2009 acquired the rights to both platforms, as well as supporting technology, for $200 million.

BEIJING — While China's Pang Da Automobile Trade and Zhejiang Youngman Lotus have been under the media spotlight as potential white knights attempting to rescue cash-starved Saab, Beijing Automobile has been quietly preparing to launch Beiqi-brand vehicles developed from Saab technologies it acquired in 2009.

State-owned Beijing Auto, the Chinese partner of Daimler and Hyundai, bought the vehicle platforms of the old Saab 9-3 and 9-5 models, as well as other tooling and powertrain technologies, for $200 million to support its efforts to roll out models under its own brand.

Beijing Auto said recently that its Beiqi C70 sedan, a model developed from the Saab 9-5 platform, will kick off production in November at its manufacturing base in Shunyi.

It also plans in 2012 to start making the smaller Beiqi C60 sedan, which uses technology from the previous-generation Saab 9-3.

Under the terms of its agreement, Beijing Auto will use a Saab powertrain and chassis components on the Beiqi C70, but the Chinese carmaker has performed a total face-lift on the exterior to better cater to the taste of Chinese consumers.

According to Ou Li, the Beijing Auto official in charge of production of the C70, the company is making all-out efforts to reduce cost before the big sedan hits the market.

"It's a challenge to turn around such a unique model to be the right product for the mass market," said Ou Li. "Saab enjoys very high performance, but its production cost is also very high."

Beijing Auto is targeting GM's production standards as a model for its own product quality. It also hired some former Saab engineers from Sweden who are familiar with the 9-5 platform to upgrade technologies and enhance engineering capability.

Inside Line says: In order to improve the competitiveness of its own auto industry, China has been encouraging domestic carmakers to develop more self-branded models after years assembling with foreign competitors. That prompted more Chinese firms, such as Beijing Auto, to look at overseas purchases as domestic engineering capability takes time to catch up.