What's news

Auto

Luxury automakers lower prices

Major international luxury car manufacturers are reducing the prices of their vehicles, parts and after-sales service under pressure from the Chinese antitrust regulator's monopoly concerns.

"Cutting prices is a business act, and the government welcomes it," said Xu Kunlin, director of the Bureau of Price Supervision and Anti-Monopoly under the National Development and Reform Commission on July 28, confirming the moves of those luxury automakers came after "they were contacted".

"Price cutting is one of their remedial measures," Xu said. "If they lower the prices to a reasonable level, that means they are sincere."

Xu said his colleagues are collecting evidence to examine the pricing of vehicles and spare parts, but the investigation is not aimed at luxury automakers but "any companies that have such problems".

Profit beats forecast as deliveries rise

Nissan Motor Co, Japan's second-biggest carmaker, reported second-quarter profits that beat analysts' estimates as deliveries rose in China and the US, its two biggest markets. Net income rose 37 percent to 112.1 billion yen ($1.1 billion), beating the 84.3 billion yen average of 14 analyst estimates compiled by Bloomberg News. Nissan maintained its profit forecast.

Hyundai profit falls in second quarter

Hyundai Motor Co, South Korea's largest automaker, reported a second-quarter profit drop after the strengthening won eroded overseas profits. For Hyundai, competition is getting tougher in markets such as China and the United States, where its delivery growth is lagging behind the industry-wide average. Hyundai boosted sales by 9.6 percent in China in the first six months of this year, lagging behind the 11 percent industry-wide growth rate, according to company and auto association data.

Tesla on track for best quarter for Model S

Tesla Motors Inc is set to report record electric Model S deliveries in the second quarter after it accelerated output and began shipping its flagship sedan to China and the United Kingdom. The youngest publicly traded US carmaker is projected to have delivered a best-ever 7,546 Model S sedans in the period that ended June 30, the average of eight analysts' estimates compiled by Bloomberg.

Medicine

Joint plan for making heart pacemakers

The medical device maker Medtronic Inc of the US and Hong Kong-listed Lifetech Scientific Corp have announced a plan for joint production of Lifetech pacemakers for China. Lifetech will develop a portfolio of pacemaker and cardiac products, and establish pacemaker manufacturing capabilities at its factory in Shenzhen. Medtronic will provide technology and training support as Lifetech enters the pacemaker market.

Aviation

Aircraft-leasing business urged to look overseas

China is encouraging financial institutions with aircraft-leasing businesses to look for opportunities overseas for expansion and fund raising. Leasing companies are required to have capital of 50 million yuan ($8.1 million) or equivalent in a "freely convertible currency", the China Banking Regulatory Commission said in a statement on its website. Financial companies should hold a majority stake in these units, it said.

Retail

Online retail market has 13 percent growth in Q2

The size of China's online retail market totaled 651.17 billion yuan ($105.4 billion) in the second quarter of this year, up 13.14 percent quarter on quarter, according to the latest report released by market researcher Enfodesk on July 29. Statistics released by the National Bureau of Statistics show that China's retail sales amounted to 6.2 trillion yuan in the second quarter, while online sales accounted for 10.48 percent of the total.

Technology

Online website to do R&D in Silicon Valley

Vipshop Holdings Ltd, a Chinese online shopping website, established its first overseas research and development center in Silicon Valley, California, on July 25. It will focus on analyzing big data and optimizing the user experience of the shopping website on mobile devices. The center will further strengthen the company's competitive edge worldwide, said Shen Ya, chairman and chief executive officer.

ZTE smartphone plant for high-tech zone

ZTE Corp says it plans to build a smartphone plant that can bring in revenue of 10 billion yuan ($1.62 billion) a year. The first phase of the plant, in a high tech zone in Xi'an, Shaanxi province, will ship 15 million smartphones each year, ZTE says. Xi'an aims to establish a complete smartphone industry chain in the city in three to five years. The government there hopes ZTE's factory will generate 100 billion yuan in annual revenue for the hardware manufacturing industry, although smartphone production has never been a core industry for the city.

Resources

Huge gold deposit found in Xinjiang

A "giant" gold deposit was discovered in Wuqia county, Xinjiang Uygur autonomous region, Xinhuanet reported on July 28. It said the Xinjiang Bureau of Geology and Mineral Resources explored a "super-large gold deposit" that could yield 127 metric tons of gold on the basis of an analysis conducted at the end of June. The potential value of the discovery is more than 40 billion yuan ($6.4 billion), which would make it the biggest gold vein found in Xinjiang.

Russian potash producer to raise prices

Russia's Uralkali, the world's largest potash producer, may increase the price for a new supply contract with China by 10 percent, Oleg Petrov, Uralkali head of sales, said. Negotiations over the new contract are expected to end by January 2015, he told Reuters. China is the world's largest potash consumer whose contracts are seen as a benchmark by the bulk of market participants.

Finance

SOEs report growing assets and revenue

The assets, revenue and profits of state-owned enterprises administered by the central government grew last year, the Assets Supervision and Administration Commission says. Assets of 113 such enterprises stood at a total of 35 trillion yuan ($5.7 trillion) at the end of the year, up 11.7 percent on the previous year. Operating revenue rose 9.1 percent to 24.4 trillion yuan, and profits rose 3.6 percent to 1.3 trillion yuan. The SOEs paid 1.9 trillion yuan in taxes last year, up 5 percent, the commission said.

Property cooling prompts revival

The Chinese government is authorizing developer debt sales for the first time in five years in an effort to avoid bankruptcies as the property market cools. Jiangsu Future Land Co, a builder of homes in eastern China, sold 2 billion yuan ($323 million) of five-year AA-rated bonds recently to yield 8.9 percent. That is less than the average 9.73 percent on trust products that many developers relied on for financing after authorities stopped approving onshore note issuance in 2009. The China Securities Regulatory Commission reversed course in April when it granted four real estate companies the right to sell the securities, after the collapse of a builder south of Shanghai the previous month underscored financing strains.

China Daily-Agencies

(China Daily European Weekly 08/01/2014 page20)