SHANGHAI: Nanjing Automobile (Group) Corp (Nanjing Auto), which acquired British carmaker MG Rover last year, has begun to export auto parts to Europe.

Zhang Xin, who is leading the project that aims to make cars under the MG Rover brand in China, said on Friday that it was Nanjing Auto's first step onto the global stage.

The company has signed an agreement with the UK-based Xpart Ltd, a division of Caterpillar Logistics Services (UK) Ltd, an auto parts distributor and vehicle service company, Zhang said.

According to a statement from Nanjing Auto, the auto components will mainly serve the owners of MG Rover cars in Europe.

The move will help MG Rover's after-sales service in Europe, as the supply of the firm's auto parts has been disrupted since the company went bankrupt.

The statement said the first batch of auto parts made at its Nanjing plant have met or surpassed the standard required in Europe, and have been welcomed by major auto parts distributors.

MG Rover's car assembly lines have been transported to Nanjing Auto's new plant in Nanjing from the MG Rover plant in Britain, according to Zhang.

Nanjing Auto is also recruiting MG Rover's former engineers and technicians in the UK to strengthen its design and innovation capabilities.

Zhang said it only took Nanjing Auto three months to produce the first batch of auto parts since the company launched the MG Rover project in March.

"Exports will not be limited to MG Rover customers in the future," Zhang said. "We are hoping to gain a niche in Europe and promote our products, which are of high quality and are reasonably priced."

He added that MG Rover's brand name would contribute to the company's globalization drive.

The firm will also utilize MG Rover's remaining sales network and distributors in Europe.

Analysts familiar with the business said Nanjing Auto's acquisition of MG Rover would accelerate its progress in the global market.

The exports, according to Zhang, will alleviate the financial pressure on Nanjing Auto, which is investing a lot of money to develop new MG Rover models in China.

The exports are also seen by analysts as a strong response to doubts about Nanjing Auto's capability to resume MG Rover's production in China.

World leading carmakers, including BMW and General Motors, which owned MG Rover in the past, failed in their attempts to reinvigorate the company.

Wang Haoliang, a senior official with Nanjing Auto, said the company was confident about the prospects of MG Rover.

(China Daily 06/10/2006 page5)

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