Barcelona car industry present at the Shanghai Automobile Fair

Barcelona (ACN).- Auto Shanghai 2011, which runs from April 19 to April 28, is the top car showcase in Asia. With Western car industries feeling the pinch of the economic slowdown, the Asia is a new attractive market to balance their accounts. SEAT is focussing on China and will start selling their Seat Ibiza and Seat León models in early 2012. Following this business strategy, car manufacturer SEAT, whose only plant is located in the Barcelona Metropolitan Area (in Martorell), showcased its products at the 14^th edition of the Shanghai International Automobile Fair ‘Auto Shanghai’. At the same event, the German car manufacturer Audi introduced its new crossover model, the Q3 to the media and the industry. The new Audi Q3 will only be produced at SEAT’s factory near Barcelona, as both Audi and SEAT are part of the Volkswagen Group. In Martorell, 80,000 Audi Q3 will be produced each year, beginning at the end of May 2011. The first models would start circulating in July 2011. At ‘Auto Shanghai 2011’, Barcelona’s car industry showed part of its potential.

SEAT begins its Chinese expansion

2012 will be a milestone in SEAT’s particular history. It will be the year the Spanish car manufacturer, which has its only huge production plant in the Barcelona Metropolitan Area, will enter into the Chinese market. SEAT will start selling only two models, the supermini Seat Ibiza and the small family car Seat León. Both cars have a young and dynamic image and design, with shared technology within the Volkswagen group. SEAT expects to attract Chinese middle-class customers, but no initial sales objectives have been set. According to the car manufacturer’s Chairman, James Muir, SEAT sells “Mediterranean passion” and design with “German precision” from its Volkswagen technology. Muir also insisted that SEAT “products reflect the essence of our city, Barcelona”, an indication that the ‘Barcelona brand’ helps SEAT.

Volkswagen has already introduced other brands into the Chinese market. In order to ease SEAT’s expansion in China, the managers are looking for local partners. The first is to raise awareness about the SEAT brand, explained James Muir. According to Muir, the company’s first objective in China is not to reach a concrete level of sales immediately but to break into the market and raise awareness. “SEAT has a loyal and passionate client-base, and now we want to explore new markets”, he stated at SEAT’s presentation in Shanghai. “I am certain that, in the same way the brand has positioned itself well in all the countries where it is present, SEAT will occupy a significant position in the Chinese market”, Muir concluded. Muir also explained that the initial idea is to develop a network of car traders only distributing SEAT models. However, the business plan will not be ready until the autumn, and currently SEAT managers are in talks with several Chinese investors. At Beijing’s Car Fair at the end of the year, SEAT’s expansion plan in China could be presented. The goal is to start selling the first cars at the start of 2012.

SEAT still concentrates most of its sales in Spain and in Western Europe; sales in emerging markets still represent a small proportion, as they only started a short time ago. Emerging markets is where car manufacturer sales are growing the most, much more than in Western Europe. Sales in Western Europe globally increased by 5% in 2010, although sales dropped in some countries in the region. However, in emerging markets, SEAT sales in Latin America in 2010 increased by 33.5% in relation to 2009 figures. In Mexico, the company expects even higher growth in 2011. The highest relative increase was in North Africa, where SEAT sales increased 129.7% in 2010, despite the small numbers in that market. All these figures make the company’s managers believe SEAT should still have quite some way to go in these emerging markets. Therefore, SEAT’s expansion in China appears to be positive.

The new Audi Q3 to be produced in Barcelona

Besides SEAT’s presence at the Shanghai fair, another Volkswagen group brand presented its new crossover model. Audi unveiled the new Audi Q3, which is only going to be produced at SEAT’s factory in Martorell, in the Barcelona Metropolitan Area. Production will start at the end of May 2011 and the first cars will be circulating on the roads in July 2011. Audi expects to initially produce 80,000 Q3s per year. The global investment made by Audi to produce this model totals 300 million euros. SEAT and the Catalan Government reached an agreement a couple of months ago to train jobseekers and then hire some of them to work producing the new Audi Q3.