New Chinese Auto Maker Qoros Debuts First Cars at Geneva

GENEVA – Qoros makes its public debut as a Chinese car company aiming to start with the best level of German quality to shorten brand development by a decade.

“We saw how other new brands arrived in the market,” says Amir Elstein, chairman of Israel Corp., a 50% partner in Qoros with Chery Automobile. “They built a base model, grew volume, then worked on quality, then their brand (and) then introduced real cars. It takes 10 to 12 years.”

Qoros, which was formed four years ago, expects to skip the early steps of that progression by starting with real cars, the first of which, the Qoros 3 sedan, is being introduced at the auto show here.

“All our suppliers are European,” Elstein says, including Magna Steyr, TRW, Continental, Bosch, Getrag, Benteler, Lear, Microsoft, Harman, Neusoft-Alpine and Iconmobile.

Qoros executives are industry veterans such as chief designer Gert Hildebrand, who penned the Mini, and head of production Alexander Wortberg, who comes from BMW.

Qoros car sales start in China this year through a network expected to reach 150 dealers by 2014, says Stefano Villanti, head of sales, marketing and product strategy.

A few cars may show up in Eastern Europe this year, but volume (sales) won’t begin until 2014. “We are still accepting bids from distributors,” says Elstein, declining to identify which countries are likely to be first.

However, he does indicate Qoros expects its presence in Europe to help sales in China. “If I know how to sell cars in France, it doesn’t matter how many, Chinese customers will love that. Success for me is success in China,” where the C-segment in which the Qoros 3 will compete is about 6 million cars a year.

Qoros is headquartered in Changshu, about 62 miles (100 km) from Shanghai, with a new factory in an automotive industrial park that also houses Chery’s joint venture with Jaguar. Suppliers are rapidly arriving in the park, Elstein says, “because they like growth.”

In addition to its assembly plant, Qoros has an engineering center in Shanghai and operations near Munich and Graz, Austria.

Capacity at the new plant is 150,000 units annually, and there is space to grow it to 450,000. When the factory reaches full capacity, Israel Corp.’s investment will be $2.5 billion, Elstein says.

The Qoros car has a 1.6L gasoline engine with two versions, turbocharged with variable valve timing. The auto maker is developing a 1.2L 3-cyl. mill that will be used in its hybrid cross/utility vehicle, a prototype of which is on display at the show here.

A station wagon prototype also is being exhibited, and Elstien hints at a fourth and fifth model in the development stages.

Chery is not Israel Corp.’s first automotive partner. The company owns Better Place, an electric-vehicle recharging specialist that is partnered with Renault to sell the Fluence sedan EV in Denmark and Israel.

Elstein says the Fluence is seeing 2,000-3,000 deliveries a year in Israel, far fewer than predicted several years ago by founder Shaw Agassi, but Elstein is not worried. “We have money, and it will take time.”

Better Place is not giving up on the idea of selling cars that can exchange their battery pack in minutes and thereby freely travel distances the same as a car fueled by gasoline or diesel.

However, the problem is it costs about $160 million to build the recharging infrastructure in a country the size of Israel or Denmark, and a place like Germany would require $1.2 billion in investment, Elstein says.

Better Place already has invested $700 million in development, design and market penetration, he adds. The idea will grow if the company can get a second manufacturer or a second Renault vehicle that uses its battery-switching method of recharging.