Abstract

China based Chery Automobile is one of the top ten car manufacturers and the leading exporter of cars in the country. Started as an automotive company by the Wuhu government in 1997, Chery designed engines for cars. After finding no buyers for its engines, it decided to build its own car. Chery entered into tie-up with another automotive company which had license to sell cars to retail customers in China. After obtaining its own license, Chery implemented a four-phase strategy to develop its technical strengths. Chery started exporting cars as early as 2001 and became the largest exporter of cars among the Chinese car companies. Chery expanded globally to have its presence in over 70 countries by 2009.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• Study and analyze the competitive strategies of Chinese automobile companies.
• Understand how Chery Auto used available resources effectively to manufacture cars.
• Examine how a startup company could develop R&D capabilities by collaborating with other firms.
• Study the globalization strategies of Chery Auto.
• Evaluate the challenges faced by Chery Auto in the near future.

Keywords

Chery Auto, Chinese Automobile Industry, Independent Innovation, Pricing Strategy, Car Manufacturing Industry, Reverse Engineering, Shanghai Automotive Industry Corporation, Six Sigma Process, Independently-designed Models, Intellectual Property Rights, Branding, Vertical Integration, Global Expansion Strategy, Safety and Emission Norms