Chen Hong named chairman of SAIC



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    Chen Hong named chairman of SAIC

    Post by snifferdog1 on Thu May 29, 2014 12:02 pm

    SAIC Motor Corp., China's largest automaker, named Chen Hong, previously the company's president and vice chairman, its new chairman.

    The state-owned automaker said Chen will succeed Hu Maoyuan, who retired last week after 15 years as SAIC's chairman.

    Chen, 53, joined SAIC in 1984. For the next 20 years, Chen held senior executive posts at the automaker's joint ventures with Volkswagen AG and General Motors.

    In 2007, he returned to SAIC to be the company's president and vice chairman.

    Chen Zhixing, previously head of SAIC's passenger vehicle division, was named the company's president last week, according to SAIC.

    Source - Automotive news China.

    There is also an article about his predecessor which you may find interesting -

    SHANGHAI -- Hu Maoyuan, who retired this week as SAIC Motor Co.'s chairman, had that rarest of qualities for the chief executive of a state-owned automaker.

    He was bold, he took risks and he was not afraid to fail. And if China's automakers learn how to penetrate overseas markets, they can thank Chairman Hu for showing them how.

    [See the accompanying article in this newsletter about Hu's successor, Chen Hong.]

    To be sure, Hu had the necessary skills to rise within a state-owned company. After joining SAIC in 1968, he steadily worked his way up the ladder to the company's top position, and he dutifully carried out government mandates.

    For example, when the central government called for domestic automakers to develop electric cars in 2010, Hu fell in line despite experts' reservations about the health of the EV market.

    But in one aspect, Hu clearly stood out from the chiefs of other state-owned companies. Unlike his fellow CEOs at other state-owned automakers, he boldly led SAIC into Europe and other overseas markets.

    Boldness is a quality rarely found among leaders of China's state-owned companies.

    State-owned companies are controlled by government bureaucrats, and these bureaucrats would like the companies to take orders from them. In these corporate circles, boldness is a character flaw.

    But Hu was not afraid to step out of line when the need arose. In 2004, he made a risky decision to acquire a controlling stake in Korean SUV maker SsangYong Motor Co. for $500 million. It was the first acquisition ever made by a Chinese automaker overseas.

    Hu also hired former General Motors executive Phil Murtaugh
    to integrate Ssangyong into SAIC's operations. It was another extraordinary step, since state-owned companies typically promote executives from within.

    Murtaugh left his post as SAIC's vice president in 2007, but he remains the only foreigner hired by a Chinese state-owned automaker to fill a senior executive post.

    In 2005, Hu followed up on the Ssangyong acquisition with another major deal abroad. SAIC bought the Rover 75 platform from MG Rover, and recruited former MG Rover engineers to staff its r&d center in England.

    To be sure, Hu's foreign deals generated mixed results. His agreement with MG Rover paid off nicely, as SAIC used its Rover platform to launch the Roewe 750 mid-sized sedan and 550 compact sedan.

    But the Ssangyong acquisition floundered.

    Lacking experience with Korean labor unions, Hu struggled to cope with a series of strikes at Ssangyong. And in 2009, he was blindsided by a Korean court that ordered Ssangyong to restructure its assets -- a decision that significantly diluted SAIC's stake in the company.

    You could argue that this was all part of the learning curve for SAIC -- a necessary experience for the first state-owned automaker to operate overseas.

    Two thirds of cross-border mergers and acquisitions in the auto industry worldwide have failed, according to statistics. One can't expect SAIC to beat the odds every time it makes an overseas acquisition.

    As a top executive at SAIC for nearly 20 years, Hu has left a rich heritage for the company. He helped launch a successful car brand -- Baojun -- for the company's microvan joint venture with General Motors.

    And he was a trailblazer for domestic automakers seeking to expand globally. Following SAIC's overseas acquisitions, Geely acquired Volvo Car Corp. and Dongfeng Motor Corp. bought a stake in PSA Peugeot Citroen.

    If China's automakers learn to compete in international markets, Hu will deserve much of the credit.

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    Re: Chen Hong named chairman of SAIC

    Post by patpending on Thu May 29, 2014 2:08 pm

    Goodbye Mr. Hu.

    Clearly "Chairman" is not the operational boss - who is New Mr. Chen, President.

    Chen Zhixin, 55, is currently the executive vice president of the Shanghai-based automaker and will replace Chen Hong, 53, who currently also serves as the company's Party chief and vice chairman. Chen Hong is expected to soon replace the retiring Hu Maoyuan, 63, as company chairman.

    The new management team will face the challenge of keeping up the company's momentum after annual sales surpassed the 5 million unit benchmark for the first time last year, setting a sales record for the country's five biggest domestic automakers.

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    Re: Chen Hong named chairman of SAIC

    Post by Windy on Fri May 30, 2014 4:02 am

    And the more detailed Chinese version:

    SAIC Double Chen Era starting

    SAIC announced, former chairman Hu Maoyuan due to the age of retirement.  Chen Hong, vice chairman of the company's election as chairman of the Fifth Board, which no longer serve as president.  Chen Zhixin, executive vice president of the company appointed as the company's president.

    At this point, as chairman and party secretary Chen Hong, SAIC, SAIC become "top-level officials"; Chih-Hsin Chen served as president of SAIC, SAIC became the "second hand."  However, the pressure "dual Chen" after he took office facing not light, SAIC is already the nation's largest auto companies, but their own brand of less than 20% in the proportion of overall sales, and is still in the "burn", how expand sales of its own brand, while improving profitability is still a test of "double-Chen" wisdom.

    SAIC chairman Hu Maoyuan original

    Chen Hong from the period 1997-2003, are held at Shanghai GM vice president and general, and Shanghai GM marketing for all to see, Chen Hong himself on strategic decisions, but also very decisive.  And Chih-Hsin Chen was born in May 1959, and longer than the technical, practical and stable.  As SAIC stands for "technical school" before the charge of their own brands, Chih-Hsin Chen has worked for SAIC's joint venture Shanghai Volkswagen.  In the 20 years between the general manager of Shanghai Volkswagen has been before, Chih-Hsin Chen also grow as a proficient automotive engineers and engineering managers.  In 2002, under his leadership, the Shanghai Volkswagen products annual sales topped 30 million.  After he moved to autonomy, Chih-Hsin Chen emphasis on product quality, technology development, and technology value-added services such as content, so the early success of its own brand.

    SAIC chairman and party secretary Chen Hong

    From the terms of size, SAIC has reached the level of the world's top ten.  In the era of Hu Maoyuan, SAIC brand from the first car off the assembly line Roewe 750, just after five and a half, on the realization of 200,000, became independent brand reached 200,000 steps fastest.  And, with most of the domestic independent brand car enterprises are facing a lower price, brand premium weaker different, SAIC brand average more than 110,000 yuan, direct and joint benchmarking.  But SAIC's competitive advantage is mainly reflected in several joint automobile companies.  2013, SAIC continued reelection passenger 500 sales over 5.1 million, but its own car brand in SAIC less than 5% of total sales.  In addition, SAIC also faces its own brand profit bottleneck.  Chih-Hsin Chen had several plans put forward earnings, raised 10 million in 2012 and 2013 profit target raised 50 million profit target, the final average earnings plan and missed.  Own-brand sales currently insufficient to support R & D investment, according to SAIC announced sales, SAIC brand total investment has reached 45 billion yuan, 22.2 billion yuan invested a further "five-second" period, and in 2013 as an example SAIC allocated only 23 million vehicles, the cost can be imagined.

    SAIC president Chen Zhixin

    "Only one way out, is the need to upgrade at the same time scale, earnestly implement the innovation-driven development strategy to put innovation at the heart of global development." Chen Hong said.  Next, SAIC launched a comprehensive brand strategy to optimize the project.  The core of the optimization project is to clear positioning Roewe and MG brands have competitive differential advantage in the relative position occupied by the target market.  In addition, SAIC still strengthen their own brand investment, according to SAIC planning, independent sector will continue to increase investment, "Twelve Five" total investment of 45 billion yuan to build the completion of seven platforms, completed more than a dozen new models of delivery.  Medium and long term, SAIC has been studying and exploring future technology is also of concern.  Two years ago, SAIC intranet from a car break SAIC's initial investment in the inkaNet3.0 nearly 200 million yuan, the latter will continue to invest 2-300000000 yuan, to expand inkaNet3.0 platform, trying to keep the car networking leader.  Meanwhile, SAIC also looking for a new breakthrough - new materials and new energy.  SAIC and Baosteel Group, a joint research and development of new materials for automotive lightweight vehicles, SAIC has extensive use of ultra-high-strength steel in electric cars Roewe E50 car body, the application of the proportion of lightweight materials and ultra high strength steel in excess of the market most Traditional models.  The next stage, SAIC to achieve commercial operation of new energy sources, new energy technologies will soon configured to do different engines different product platforms.  "Twelve Five", SAIC investment in new energy vehicles, will have invested on the basis of two billion yuan, plans to cast six billion yuan.  Recently, the SAIC is promoting an "A framework" new powertrain plans.  SAIC plans to carry a whole new generation powertrain to enhance the competitiveness of their products, while reducing costs through platform, which plans to launch later, SAIC own brand products will be implemented in 2020 to reduce carbon emissions over 20% power increase over 20% and 20% of the economy to improve over the three comprehensive goals.  Meanwhile, SAIC's profit goals will advance to 200,000.

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