SAIC unveils Roewe in Beijing

And other news in Greater China

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SHANGHAI--China's No. 2 car maker, Shanghai Automotive Industrial Corp. (SAIC), gave the public a look at the first car brand the company has developed without an international partner. The controversial Roewe (Rongwei in Chinese) debuted in late November at the Beijing Auto Show.

The name, like the car itself, has produced waves of controversy over the past year in one of the first sectors opened to foreign manufacturers. European, American, Japanese and Korean car companies have all watched local companies evolve with astonishing speed from a group of inefficient state-run behemoths hungry for foreign investment and management experience into sleek operators more interested in acquiring overseas car makers than partnering with them.

The Roewe is one of the most visible examples of how capable, and ruthless, Chinese companies can be. It was created by SAIC, a joint venture partner of both General Motors Corp. and, on a smaller scale, Volkswagen Group.

The first model, the Roewe 750, is the first Chinese-made executive-class sedan with British design and engineering. It is based on the Rover 75, using technology and intellectual property rights acquired from the British carmaker MG Rover in 2004. One year later, SAIC rival Nanjing Automobile Group Corp. (NAC), bought the U.K. company’s MG brand.

But the Rover brand name was not included in either acquisition; it belonged to BMW, Rover’s former owner. SAIC was negotiating to buy the brand to slap on its new car--and auto industry sources say the company was sure the deal would eventually go through.

At the last possible moment, Ford Motor Co. excised its right of first refusal to buy the Rover brand name, which dated back to its acquisition of Land Rover in 2000. That last-minute move sent SAIC scrambling to revise its launch strategy, including a new English name. It settled on Roewe, which it claims is derived from the German word loewe for lion, although there is no denying the phonetic similarities of “Roewe” and “Rover.”

The Chinese name, meanwhile, represents a progressive attitude with Chinese core values through characters with meanings like “glorious, reputation, authoritative [and] respect," said Viveca Chan, Hong Kong-based chairman-CEO of WE Worldwide Partners, the architect of the Roewe brand. It represents the determination and ambition of SAIC Motor to combine tradition with innovation to expand internationally, she added.

That determination is just what worries foreign automakers, particularly GM., China's largest car marketer in China thanks to strong sales for the Buick and Chevrolet models produced by its joint venture with SAIC.

Steve Betz, Chevrolet brand director at Shanghai GM, declined to comment on SAIC’s transformation from partner to rival. Earlier this year he told AdAgeChina “There will be Chinese cars imported into the U.S. eventually, I definitely see that happening [and they] will definitely be competition.”

Jack Perkowski, Beijing-based chairman-CEO of Asimco Technologies, an auto parts maker in China, warned, “If they aren’t worried about SAIC’s expansion plans, they should be.”

The Roewe is the company's first proprietary automotive venture outside of its existing joint ventures with GM and VW, but it won’t be the last, according to SAIC’s chairman, Hu Maoyuan, who has publicly called the Roewe 750 launch only "the beginning” of SAIC's ambitious plans.

Outdoor ads for Roewe, created by WE, broke late last month in Shanghai, including a 15-story tall ad wrapped around a high-rise building.

Meanwhile, GM and SAIC have formalized an agreement with the World Expo 2010 Shanghai Executive Committee to become the Expo's exclusive automotive partner. The two automakers, which operate seven domestic joint ventures, are the first Chinese and foreign companies to join hands to become an exclusive partner of the global exposition, which will run from May 1 through Oct. 31, 2010.


Levi's creates concept cafe in Hong Kong to attract Christmas shoppers
HONG KONG--Levi Strauss & Co. has set up a temporary concept store and cafe in Hong Kong to launch its Levi's Red Tab collection, developed in Tokyo with Japanese-inspired design features. The outlet, located in the Chinese territory’s Causeway Bay shopping district next to the current Levi's store, will be open for one month starting Dec. 1, 2006, to capitalize on holiday shopping.

The cafe lets teens and young adults experiment with fashion styling while they consume branded cake, Levi's shaped cookies and branded chocolates. Coffee mugs, napkins and other accessories have also been designed and styled especially for the store. It was developed by Tequila, the below-the-line marketing arm of TBWA Worldwide, along with the global cosmetics brand Shu Uemura and local hair care partner Hair Do. Staff from both partners will be on-hand to help consumers implement a new look.

“The concept store has been designed by demonstrating Levi's own style, featuring furnishings made of Levi's denim including sofas, coffee tables and cushions. It will also showcase the latest street styling trends from Japan,” said Florence Kong, Tequila’s group account director in Hong Kong.


Unilever focuses on beauty benefits to launch Lipton herbal teas in China
SHANGHAI--Unilever is promoting the beauty benefits of Lipton in China, one of the world’s largest producers and consumers of tea.

The new campaign, created by JWT, Shanghai, supports the launch of Lipton’s herbal tea range, and is aimed at young Chinese office workers, who are ambitious but self-conscious about their looks, according to Sofia Huang, Unilever’s regional business development manager for Lipton Tea. Unilever created 15” and 30” versions of a TV spot airing throughout China earlier this month that will run until next year, as well as print, advertorial and in-store communication.

The message behind the communication is the ability of Lipton’s herbal teas to offer “a full moisturization from tongue tip to finger tips, ensuring that a woman's beauty will blossom,” said Ms. Huang. That's an appealing promise for office workers in buildings with skin-drying air conditioning..
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