SAIC Motor Profile Internationalization R&D Patents

16 Апр 2014 | Author: | Комментарии к записи SAIC Motor Profile Internationalization R&D Patents отключены
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SAIC Motor Corporation Ltd.

Overview: One of China’s Big Four

SAIC Motor Corporation Ltd. is a state-owned automotive manufacturing company, headquartered in Shanghai. Its name SAIC originates from its former name Shanghai Automotive Industry Corporation. The company is one of China’s oldest car manufacturing companies and nowadays one of the Chinese Big Four automakers, along with Chang’an Motors, FAW Group, and Dongfeng Motor.

In 2012, SAIC produced 4.5 mn vehicles and according to its production volume was the biggest of all Chinese car manufacturers. Most of SAIC’s vehicles are passenger vehicles, but the company also offers commercial vehicles and spare parts for other manufacturers. The company sells vehicles under a variety of brands like Maxus, MG and Roewe.

Additionally, SAIC established joint ventures with large international companies such as Volkswagen or General Motors to produce vehicles.

Through its growing business, SAIC generated a revenue of USD 67 bn in 2012 and was ranked number 130 among the Fortune 500. Encouraged by the success, SAIC aims to establish itself as one of the largest automotive manufacturers worldwide in the near future.

Internationalization Strategy: Cooperation from the Beginning on

To become one of the world’s biggest automotive manufacturers, SAIC follows an expansionary internationalization strategy. The company grew to an important automotive manufacturer in the 1980s, when it started to cooperate with Volkswagen. In 1985, the two companies established their joint venture, the Shanghai Volkswagen Automotive Co Ltd.


Convinced by the success of this cooperation, SAIC repeated this strategy and formed another major joint venture with General Motors in 1997, the Shanghai General Motors Co Ltd..

Since the early 2000s, the company initiated an expansive acquisition strategy. At first, it participated in the takeover of the Korean manufacturer Daewoo by General Motors. Later in 2004, SAIC assumed control of the ailing Korean automaker, SsangYong Motor, paying USD 500 mn for a 48.9 percent ownership of the company.

In the mid-2000s, SAIC made an attempt to acquire the British automaker MG Rover, but was outbid by another Chinese automaker, Nanjing Automobile in 2005. However, the company managed to obtain some of MG Rover’s technology, which it implemented to its new luxury line brand Roewe. One year later, SAIC incorporated MG Rover with its successful acquirement of Nanjing Automobile and established MG as one of its own brands, continuing the production of the traditional brand MG in the UK in 2011.

With this step, SAIC tries to earn some market share in Europe.

At the same time, SAIC founded its US subsidiary Shanghai Automotive Industries Corp. USA Inc. and opened a North American operations center in Birmingham, Michigan. Thus, an increasing market share in the US can be expected in the next years.

SAIC is most likely to continue its expansive internationalization strategy in the next years by penetrating new markets.

R D and Intellectual Property: Increasing Efforts for its own R D

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Through its cooperation with western car manufacturers, SAIC was able to increase its knowledge in the development and production of cars. Nevertheless, an own R D division is crucial for a company whose target is to become one of the biggest global players in this industry. From 2002 till 2009 a continuous growth in SAIC’s applications can be observed

Therefore, SAIC increased its R D efforts significantly in the 2000s and is expected to continue this trend in the future. Besides its R D centers in China, SAIC operates several other R D centers worldwide, including the SAIC Motor UK Technical Centre in the UK.

Since 2002, SAIC has filed patent and utility model applications. The main difference between a patent and an utility model is the durability and the strength of protection. Patents are protected for twenty years, while utility models are only protected for ten years.

Thus, an utility model can be described as a weaker form of patent.

The following chart illustrates the number of applications SAIC filed between 2000 and 2010. Since 2002, a continuous growth of the number can be observed until 2009, when it reached a maximum of about 600 applications. The decrease of more than 100 applications in 2010 can be explained by the impacts of the world’s 2008 financial crisis, from which the automotive industry heavily suffered. The fact, that about 60 percent of SAIC’s total applications are utility models could indicate that the company still lags technologically behind the high-tech auto manufacturers.

Hence, strongest protection of its technology is not that important.

The next chart reflects the geographical distribution of SAIC’s applications. Even though SAIC follows an expansive internationalization strategy, most of its applications were filed in its domestic market, China. In the years from 2008 to 2010, a small increase of applications in foreign countries can be observed, which could indicate a change of strategy in the protection of its intellectual property rights in the future.

The next two charts show the distribution of SAIC’s applications across different technological sectors. Most of the company’s applications were filed in the sector transportation, which is typical for an automotive manufacturer. The fact, that the transportation sector accounts for only twenty percent, shows that SAIC cannot focus its research on a very small field of technologies.

Several different technologies are necessary to manufacture vehicles that are competitive with modern comparable models. Consequently, SAIC has to research in a lot of different technological sectors, which is represented by the second chart.

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BAIC E150 EV Electric Cars
BAIC E150 EV Electric Cars
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