Dongfeng Joins the Self-Help Parade in China

Dongfeng Auto, China's third-largest automaker, is the latest company in that burgeoning market to announce plans to develop its own family of passenger cars, independent of joint-venture partners Peugeot-Citroën, Nissan, Honda and Hyundai/Kia.

Dongfeng said it has earmarked $1 billion for the project. In the first phase, a new $450 million plant here will begin operation in 2008, with annual capacity to build 120,000 cars with engines ranging from 1.6 to 2.0 liters. In the second phase, a $550 million engine factory will begin construction in 2010 to supply the car-making factory. Dongfeng unveiled a sporty coupe of its own design last year at the 2006 Beijing Auto Show and reportedly is still awaiting government approval to begin production.

The automaker joins a growing list of state-owned Chinese manufacturers developing their own brands and products, some in conjunction with foreign JV partners. They include industry giants Shanghai Auto and First Auto (FAW), as well as Guangzhou Auto.