FAW

Country

China

Parent

Independent

Subsidiaries

FAW Volkswagen - 60%

FAW Toyota - 50%

Brands

FAW, Hongqi, Xiali, Jiefang (truck), Haima

Location

Headquarters and R&D center: Changchun
Main assembly plants: Changchun (FAW), Changchun (JV with VW), Tianjin (JV with Toyota), Hainan (Haima).

Sales figures

Group sales:
2008: 1,533,000 units
2007: 1,435,982 units
2006: 1,165,702 units
2005: 1,047,000 units
2004: 1,007,000 units
2003: 902,000 units

2007 sales by division:
FAW Cars: 80,000 units (Hongqi cars, Besturn)
FAW Jiefang: 126,600 units (trucks)
FAW Xiali: 180,280 units (small cars)
FAW Volkswagen: 461,369 units (Jetta, Bora, Golf, Passat, A4, A6)
FAW Toyota: 287,259 units (Corolla, Vios, Crown, MKX, Prius, Prado, Land Cruiser)
FAW Haima: 130,988 units (Mazda 6, Premacy)

Introduction

FAW (First Automobile Works) is the second largest car maker in China. Although today it produces over 1.5 million cars annually, it is basically a factory instead of a fully competent manufacturer. Most of its production come from its joint-ventures with Volkswagen, Toyota and Mazda. Even those wearing its own brands are also mostly derived from licensed foreign designs. For example, Hongqi cars are derived from Audi 100, Toyota Crown and Lincoln Town Car, FAW Besturn is derived from old Mazda 6, while Xiali models are derived from either Toyota or Daihatsu. FAW is not yet capable to develop a decent car by itself.

FAW operates 5 brands in China: Xiali, Haima, FAW, Hongqi and Jiefang. The first four are used to sell sub-compact cars, compact cars, middle-class cars and luxury cars respectively, while Jiefang is a truck brand.

Brief History

Soon after Communist Party took over China, Mao Zedong set an ambitious target of overtaking the Great Britain in 5 years and matching United States in 10 years. In order to promote the "New China" into an industrial superpower, he launched the first 5-year plan. Among others, the plan called for establishing China's own motor industry. As a result, First Automobile Works was founded in 1953 as the first car maker in China. All technologies and production toolings were donated by Soviet Union, which also helped designing the FAW production plant in Changchun.

Hongqi limousine taking Deng Xiaoping (1984)

The first FAW product was a truck named "Jiefang", which meant "Liberation" in typical communist style. In the first three decades, FAW was essentially a truck manufacturer, although it also produced a handful of Hongqi (or "Red Flag") luxury limousines for party leaders based on outdated Soviet designs. Ironically, millions of Chinese people died in hunger in the late 1950s, then waves of political thunderstorms killed similar amount in the next two decades. China had been famous for poverty, thus mass production of passenger cars was out of question.

In 1978, Deng Xiaoping launched an economic reform whose alternative name was "capitalism". As a result, the state-owned FAW became profit and market-oriented. It sent engineers to Japan for training and modernized its production plant. Production of trucks increased following domestic economic growth. The 1 millionth Jiefang truck was built in 1983.

Jetta Mk2 (1991-)

Mass production of passenger cars finally commenced in 1989, when FAW established a joint-venture with Volkswagen to produce cars in China. Initially, the venture assembled old Audi 100 based on knock-down kits, then it started producing the equally outdated Volkswagen Jetta Mk2 (which is still in service today). These cars were extensively used as government cars and taxis all over China.

2002 saw FAW acquired local competitor Tianjin Auto, which brought it the Xiali small car brand and relationship with Toyota. Later on, FAW formed another joint-venture with Toyota to produce its cars in China. Thanks to these foreign ventures, FAW became the first Chinese car maker to reach 1 million units of annual sales in 2004.

Besturn (2008)

In the late 2000s, the company tried to increase the local content of its cars. With help from Western engineering consultants and design houses, it developed its own designs like Vita C1, Haima 3 and Besturn. However, their underpinnings were still based on its existing joint-venture cars. Despite of its existence for over half a century, FAW has yet to realize the original target of Mao Zedong.