Chinese companies at a glance

Power losses

More than 70 percent of China's State-owned power generation firms are in the red, says an official with the State-Owned Assets Supervision and Administration Commission (SASAC).

High coal prices coupled with fixed power tariffs are responsible for the losses, and could eat into investments in energy saving and pollution control, said SASAC official Liu Nanchang in an interview with the official government website.

"Of course, I hope that at an appropriate time, related state departments adopt effective measures to resolve the problems," Liu said. "This call is based on one condition, that price stability can basically be maintained and the difficulties of enterprises can be considered in an appropriate manner," he adds.

However, he also noted that the big State-owned firms were still making money from non-coal-fired power, and should not use high coal prices as an excuse to cut back on environment-related investments.

He said that in 2007, China's power plants consumed 357 grams of standard coal for each kilowatt-hour of electricity produced, higher than the international average of 317 grams, and that there was still great potential for savings.

Chery export surges

Chinese carmaker Chery Automobile has recorded a 68.8 percent growth in the number of exported vehicles during the first quarter, the company says.

It exported 37,976 vehicles, 15,478 ones more than the corresponding period last year. The exports accounted for 34.9 percent of its sales in the first quarter.

To date, the 11-year-old company, based in Wuhu, Anhui province, has sold cars to 69 foreign countries. It is eager to enter another 15 countries in Central America and the Caribbean this year.

Chery plans to raise its annual output to one million vehicles by 2010.

Vehicle sales are forecast to reach a record 480,000 units this year, after rising 24.8 percent year on year to 381,000 units in 2007. The company remained the country's fourth largest automobile seller in 2007, it said.

Its exports, which jumped 132 percent to 119,800 units in 2007,were expected to rise to 180,000 this year.

Becoming B2C

Alibaba's affiliate Alipay has entered into a cooperation with Amazon, the world largest business-to-customer (B2C) e-commerce services provider.

The contract has been inked, and details are going to be released soon.

A source close to Alipay says that Alipay is likely to marry with Amazon.cn, Amazon's Chinese branch, at first and then possibly extend overseas.

Under their cooperation, Amazon.cn will support online payments via Alipay's platform in an effort to support its cash flow, which is always the problem for B2C websites.

Almost 70 percent of Amazon.cn's businesses are paid on delivery, and large amount of cash usually simply sits at the delivery companies, insiders say.

Not long ago, Taobao.com announced plans to enter the B2C market and it's become a competitor of Amazon.cn and Dangdang.com. At the same time its sister service Alipay began to cooperate with many vertical B2C websites, including redbaby.com.cn and 360buy.com.

Alipay's 2007 transaction volume hit 50 billion yuan, of which 70 percent came from Taobao.com. "We plan to lift our non-through-Taobao business proportion to 50 percent this year," said Kong Fei, Alipay's senior market public relations manager.

Bean curd trademark dispute

A famous Chinese bean curd brand, Wangzhihe, said it is confident of winning an appeal filed by a German company in the country over a trademark infringement dispute.

Wang Jiahuai, general manager of Beijing-based Wangzhihe Food Group, says the company filed documents against the German company's appeal in early March in a high court in Munich and was awaiting the verdict.

Wangzhihe, which began in 1678 and featured Beijing-style "stinky" bean curd, noticed in July 2006 that its brand had been registered by OKAI on November 21, 2005. Because it wanted to expand into the German market it filed a lawsuit against OKAI in Munich in January 2007.

Germany's OKAI company lost the lawsuit in November last year. The local court ruled that the OKAI company should stop using the Wangzhihe trademark logo in Germany and the brand OKAI registered there should be revoked.

"OKAI has not provided new evidence. We have new evidence, we will stay until the very end and we will win," Wang said.

Currently, Wangzhihe has completed trademark registration in more than 40 countries and region.

Ethylene plant

China Petrochemical Corp, the nation's largest oil refiner, may seek investors to help build an ethylene plant in southern China to meet rising demand for the raw material for plastics and synthetic fibers.

"We haven't been in talks with any partners, though we don't exclude the possibility," said Zhang Jianhua, the vice general manager of Sinopec Group, as China Petrochemical is known. The government has granted approval for a feasibility study on the one million metric ton-a-year plant.

Sinopec has ethylene ventures with BP Plc, BASF SE and SK Corp in the eastern cities of Nanjing and Shanghai, and in the central province of Hubei, which imports half of its ethylene needs, aims to more than double production capacity to 18.13 million tons by 2010. Demand will rise 10 percent to 18.7 million tons this year, according to a government forecast.

"The project may not start before 2010, as designing work for such big plants is always complicated," Zhang said. The plant will be built in Hainan, he said.

Besides refining ventures, Sinopec Group is among the Chinese state oil companies that are boosting spending in exploration projects, both domestically and overseas.

Cross-cooperation

Chinese sportswear leader Li-Ning Co announced recently that it has tied up with French tire producer Michelin to start technical cooperation to produce high-performance sports shoes.

According to the agreement, Michelin's tire techniques will be used for the soles of Li-Ning brand shoes in order to provide sports footwear with stronger grip and wear resistance.

The Chinese sports market has become one of the fastest developing markets around the world with a double-figure annual growth rate, and it is expected to reach $6.2 billion in 2008. Elie Chkaiban, director and general manager of Michelin Lifestyle Ltd, says the company promotes travel and sports products other than Michelin tires.

New factory

Beijing Hyundai Motor Co announced this month the completion of the first phase in the construction of its second factory. On the same day, Beijing Hyundai's new model, the Elantra HDC, was officially listed for sale.

The new plant is located in Shunyi district in north Beijing, with a total investment of nearly 12 billion yuan and consists of four workshops for stamping, body, painting, and general assembly, as well as a group technology center.

After the completion of its second factory, Beijing Hyundai Motor will have the capacity to produce 200,000 vehicles annually, and in 2010, after the completion of the project's second phase, the factory's overall production capacity will reach approximately 300,000 per year. By then, Beijing Hyundai Motor will have a total annual manufacturing capacity of 600,000 vehicles with the original 300,000 units in the first factory.

Since its establishment on October 2002, Beijing Hyundai Motor has quickly climbed the ranks to the forefront of China's auto enterprises. On February 22 this year, the motor company's one millionth vehicle came off the assembly line, making it the first enterprise to sell one million vehicles in domestic sales in the shortest time.

(China Daily 04/21/2008 page7)