(Xinhua)
Updated: 2007-08-22 21:46

Wuhu -- China's Chery Automobile produced its millionth car on Wednesday, becoming the first Chinese automaker to reach the milestone.

A model poses with a Chery A5 at an exhibition in Shanghai. [newsphoto]

The firm, established in 1997, started production in 1999 and made its first million cars in seven years and nine months, said a statement from the company.

It took Chery about six years to make its first 500,000 vehicles, and only 17 months to complete the second half million.

The millionth car is an A3 four-door hatchback, which made its debut at last year's Beijing auto show and is expected to go on the market later this year.

The compact model, equipped with Chery's own-brand engine, was designed to meet environmental and safety standards in the US and European markets, despite some industry analysts claiming Chinese producers lack the technology to meet the standards on their own.

In contrast with Chery, Sino-German automaker FAW Volkswagen spent 13 years making its first million cars, while it took more than eight years for Shanghai GM and Guangzhou Honda to build their first million cars.

Chery, the ambitious flag-bearer of Chinese indigenous brands, is capable of producing 400,000 cars, 400,000 engines and 300,000 transmission cases a year and plans to raise its annual output to one million cars by 2010.

A new plant, which will begin production in October this year, will increase capacity by an additional 250,000 to 300,000 cars a year.

China has 30 sedan manufacturers, nine of which produce more than 200,000 vehicles a year.

Chery, based in the eastern city of Wuhu, sold 232,785 cars in the first seven months of the year, maintaining its position as the country's seventh largest auto manufacturer and the fourth largest sedan producer.

It held 7.2 percent of the domestic market last year, up from 6.7 percent in 2005.

With sales on the home market dominated by foreign automakers such as General Motors, Volkswagen and Toyota, Chery is eager to expand on the global markets.

Since 2001, it has exported 153,694 cars to 56 countries, making it the biggest Chinese sedan exporter for four consecutive years. It plans to raise annual exports by 800 percent from last year to 400,000 by 2010.

Chery, which operates seven plants in six other countries, including Russia, Uruguay, Indonesia and Egypt, would build another 14 overseas plants by 2010.

Earlier this month, Chery established ties with Italy's Fiat to supply 100,000 engines a year for Fiat cars made in China and abroad.

Chery has also signed a deal with Chrysler to export Chinese-made cars to the United States and Europe. The two companies will jointly develop new products based on Chery's small-car platforms.

Cooperating with foreign automakers was no barrier to developing Chery's own-brand products, said president Yin Tongyao. "It will help Chery build indigenous cars with international competitiveness."

In his congratulatory letter to the automaker, Chinese Vice Premier Zeng Peiyan said Chery had distinguished itself as China's self-developed auto brand at home and abroad.

"Taking the millionth car as a new starting point, Chery should further innovation on technologies and management and upgrade its products and service," Zeng said.