Chinese Chery small cars may come to India

Chinese carmaker Chery Automobiles angling for alliance with ICML, makers of Sonalika Tractors, for making small car in India.

1 May, 2007

“My next car is made in China”. This could be what car stickers would read from now on. According to reports, China’s famed name in the auto sector, Chery Automobiles, may tie up with the Delhi-based International Cars and Motors Ltd (ICML) to unveil a small car in India.

ICML, the makers of Sonalika Tractors, is reportedly in talks with Chery for the small car. The new small car from the ICML-Chery stable might be a premium hatchback in the Rs 3-4 lakh price range.

This partnership, if it succeeds, would be Chery’s first try in the Indian car market. It already has factories in Iran, Russia, Malaysia, Egypt and Pakistan. The Chinese car manufacturer already has a bouquet of small cars and dominates the compact and hatchback segment in China.

Meanwhile, ICML is planning to manufacture Chery products at competitive prices from its tax-free production facility in Himachal Pradesh. There have also been reports that the 24 per cent excise break will translate into a major price gain for the ICML-Chery alliance.

With Toyota, Honda, Ford and Mitsubishi planning to launch small cars, the possible Chery-ICML alliance might get to see ample competition. The 1.38-million small-car market in the country is currently dominated by players like Maruti, Tata Motors and Hyundai boasting of about 85 per cent domination. The report added that Chery is targeting more than one million cars by 2010, of which 40 per cent would be driven by overseas sales. The car maker has models like Eastar, A5, Cowin, V5, and QQ in the small and mid-size segments and they are all reported to be 20-30 per cent cheaper than those made by Maruti, Hyundai, and Tata-Motors.