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Auto

Volvo goes upscale for wealthy buyers

With headlights shaped like Thor's hammer and space for a humidity-controlled cigar case, Volvo's new cars are sporting luxury features and designer glitz to catch the eye of the booming Chinese market and shed their safe-but-dull skin.

The XC90 SUV launch on Aug 26 will be make or break for a company moving into a premium market dominated by German rivals.

It will be the first fully new car under Chinese parent Zhejiang Geely Holding Group Co, which bought Volvo from Ford Motor Co four years ago, and heralds the revamp of its entire product range to more upmarket models.

The company hopes the new line will reverse declining sales in the US but must persuade customers to spend up to 100,000 euros ($133,700) for a brand many associate with functional family cars.

Shanghai GM expands vehicle output capacity

The third phase of the vehicle and engine plant set up by Shanghai GM (Shenyang) Norsom Motors in Shenyang, the capital of Liaoning province, started production on Aug 18. The total investment in Phase III of the project amounts to 7 billion yuan ($1.14 billion). The new factory, with an annual output of 300,000 cars and 450,000 engines, includes five new major international-standard workshops - body shop, paint shop, assembly workshop, power train mount workshop and stamping shop. Set up in 2004, Shenyang's GM plant now has an annual capacity of 500,000 cars and 450,000 engines.

Retail

Sun Art Retail store sales dampened

Sun Art Retail Group Ltd, China's largest hypermarket operator, said same-store sales growth for 2014 will not increase for the first time in six years due to a slower economy and the government's anti-corruption measures. The expiration of Chinese subsidies for energy-saving electrical devices also affected sales, Chief Financial Officer Jean-Patrick Paufichet said on Aug 14.

Retailers in the world's second-biggest economy have been grappling with a slowdown as the property sector has weakened. Spending by government officials and businessmen on luxury items and liquor has also plunged as the country has been pursuing an anti-corruption campaign.

Energy

Fosun to be top Ironshore shareholder

Fosun International Ltd will take a stake in United States-based Ironshore Inc by acquiring ordinary shares equivalent to 20 percent of Ironshore's total outstanding ordinary shares on a fully diluted basis, the two companies announced on Aug 18. Fosun will thus become the largest shareholder of Ironshore. Fosun, an investment group involved in insurance, industrial operations, investment and asset management, has invested more than one-third of its total assets in insurance.

Retail gasoline, diesel prices drop

The National Development and Reform Commission announced on Aug 18 that the retail price of gasoline would be cut by 190 yuan ($31) a metric ton and that of diesel by 185 yuan a ton as of Aug 19. It was the sixth oil product price cut this year, and it works out to 0.14 yuan a liter for gasoline and 0.16 yuan a liter for diesel.

Wholesale coal-fired power rates cut

China will cut wholesale prices that distributors pay for electricity from coal-fired plants, two government officials said, a move that may allow it to compensate struggling coal suppliers. The National Development and Reform Commission, the top planner, told provinces to impose cuts at an average rate of about 0.0093 yuan (0.00151 cents) per kilowatt hour, according to the officials, who asked not to be identified because they weren't allowed to discuss the matter publicly.

Company

Starbucks not under antitrust investigation

US-based coffee chain Starbucks Corp is not an immediate target for investigation in China, sources with the nation's antitrust regulator said on Aug 14. The China Securities Journal had reported that Starbucks might be the next target for antitrust investigations, partly because the company's profits in China and the Asia-Pacific region are higher than in Europe and the United States. "The report does not match with the real situation," a senior official of the price and antitrust department at the National Development and Reform Commission told China Daily. "It's a rumor. Starbucks hasn't been involved in any antitrust investigations to date," said a source familiar with the issue.

China Minsheng Bank chairman resigns

Dong Wenbiao, chairman of China Minsheng Banking Corp Ltd, has resigned from his post and will be succeeded by Hong Qi, managing director and president, according to a statement issued by the lender on Aug 18. Dong, 57, has been at the bank for more than 20 years and served as its chairman for eight years. He will become president of an investment company in Shanghai, Century Weekly reported.

Technology

Mobile payments up 137% in Q2

The value of mobile payments in China rose 137 percent year-on-year to 4.92 trillion yuan ($800 billion) in the second quarter, according to a report by the People's Bank of China. The PBOC also said that electronic payments, including mobile payments and online payments, totaled 327.11 trillion yuan, an increase of 30.3 percent from a year earlier. Online payments, the largest component of e-payments in China, totaled 321.14 trillion yuan in the second quarter, up 29.6 percent on a yearly basis.

China Mobile's profit beats estimates

Mobile operator China Mobile Ltd posted profit that beat analyst estimates on Aug 14 as the expansion of the fourth-generation network and sales of Apple Inc's iPhone helped the company add more subscribers than competitors added. Net income was 32.5 billion yuan ($5.3 billion) in the second quarter, according to figures derived from six-month results, the company said. That compares with the 29 billion yuan average of four estimates compiled by Bloomberg.

China Mobile had 13.9 million 4G customers at the end of June, more than quadruple that of second-ranked China Unicom (Hong Kong) Ltd, helping drive a 52 percent surge in data traffic revenue.

Finance

Yuan forwards snap losing steak

Yuan forwards rose for the first time in three days on Aug 14 as optimism about a recovery in the world's second-largest economy gathered momentum. China's trade surplus swelled to a record $47.3 billion in July as exports grew at the fastest pace in 15 months, while manufacturing expanded the most in more than two years, according to official data released over the past two weeks. The People's Bank of China cut the yuan's reference rate by 0.02 percent to 6.1545 per dollar. The currency has risen 1.8 percent from this year's low of 6.2676 on April 30.

Shanghai Gold Exchange to trade in FTZ

The Shanghai Gold Exchange will start bullion trading in the city's free-trade zone on Sept 26, according to three people with knowledge of the matter who spoke anonymously. Gu Wenshuo, a spokesman for the exchange, confirmed that the trading system is being tested but gave no further details. Shanghai wants to become a regional bullion-trading hub, giving foreigners access to the world's largest physical gold market, Xu Luode, the exchange's chairman, told a conference in Singapore in June. The contract will be priced and settled in yuan, and the infrastructure is in place for trading to start in the third quarter, Xu said in June.

China Daily-Agencies

(China Daily European Weekly 08/22/2014 page18)