Chinese-car dealership
Published:Friday | May 21, 2010 | 12:00 AM
Avia Collinder, Business Writer
Car-parts company André's Auto Supplies Company Limited is about to launch into motor-vehicle sales with an arrangement all but tied up for the acquisition of the dealerships for the Great Wall and JACS brands of Chinese-made vehicles.
"While there are a few things still to be finalised with China, we, however, have taken over all the stock and is now doing the servicing of the line at André's Auto, and as soon as we sign off on it with China we will be stocking vehicles," majority shareholder and managing director, André Hylton, told the Financial Gleaner this week.
Andre's, whose business lines currently include auto-parts sales and repairs, will be the company selling and servicing the China-made vehicles.
While a formal dealership agreement has not yet been inked for the Great Wall and JACS vehicles, Hylton said his company has made "a special arrangement" with China Motors, the Montego Bay-based company, which was the previous dealer for the brands, to service the vehicles in the interim.
"The spirit of (the arrangement) was that they did not leave the brands unserved; there are many of the vehicles in Jamaica," said Hylton, whose company took over the servicing and supply of parts for the vehicles in February this year.
The businessman declined to say what level of investment the new dealership and service facility would involve.
Virginia LaCroix, administrator of the Automobile Dealers Association of Jamaica, said China Motors closed out its business in 2008.
Run by Oliver Townsend, who held the position of managing director, China Motors was located at the Bogue Industrial Estate in Montego Bay. Townsend, who is also the operator of Caribic Vacations, was not immediately available to comment on the dealership's closure or the new arrangement with André's Auto.
LaCroix states that for a dealer intending to begin importing new cars, the primary requirement would be a manufacturer's agreement since the entity may already have in place facilities which satisfy the local ministry responsible for commerce.
Great Wall Motors is China's largest maker and exporter of commercial and sport utility vehicles. The company boasts a production capacity of 400,000 vehicles. It also produces car parts such as engines, as well as front and rear axles.
Its products sell in some 120 countries.
Jianghuai Automobile Company Limited, also known as JAC Motors, claims to be among China's top 10 automakers, with production capacity of some 500,000 units annually. Its models sell in more than 100 countries. The company is listed on the Shanghai Stock Exchange.
JACS and other Chinese companies have benefited from the Chinese government's stimulus policies, including an allocation of 10 billion yuan, or more than US$1.4 billion, over three years to support technology innovation in the auto industry, and US$2.8 billion for the promotion of new-energy cars.
In mid-2009, in an effort to help hybrid-car sales, the Government of Jamaica cut import duty on these vehicles by 63 per cent.
In June last year, the Cabinet approved an amendment cutting the import tax rate on hybrids to 16.5 per cent regardless of the size of the vehicle. The move was welcomed by Hylton at the time.
Hylton, who started business with a car-repair shop in 1984, and is said to have started his auto-parts company stocking parts in his kitchen cupboards and backyard, operates from Jamaica's two cities.
He completed expansion of his Osbourne Road, Kingston, operating base in 2005, and expanded to Montego Bay that same year, operating from East Street.