Mr. Dai says of the typical cheap knock-off model: “It didn’t drive well like the foreign car, either, and in some cases it was a safety hazard on the road.”
A clutch of design firms is driving the advances in affordability and quality in the industry, including CH-Auto, where Mr. Dai works; IAT Automobile Technology Co. of Beijing; and TJ Innova Engineering & Technology Co. of Shanghai.
China’s indigenous auto makers are so new many have not had time to groom their own engineers, and their best engineers are usually occupied more with manufacturing than design. Companies thus often outsource product design and development to outside engineering houses filled with Chinese engineers trained overseas.
Automotive analysts say these houses are responsible for helping engineer seven to eight out of every 10 cars China’s indigenous car makers sell here. By using the same few design and engineering firms, Chinese car makers have effectively created a shared pool of home-grown automotive technology.
CH-Auto, for instance, has helped design an array of cars over the past decade, each time gaining fresh expertise, which it deploys for its next project – in most cases for a different company. CH-Auto was established in 2003 by a small group of jobless Chinese engineers who had trained with Beijing Jeep, a now-defunct joint venture set up initially by Beijing Automotive Industry Holding Co. and American Motors Corp.
CH-Auto and its rivals say they have moved beyond aping foreign designs. Instead of copying the shape of a component or an entire foreign car, they try to match its performance as well – often successfully – even as they improvise and simplify the original design to cut costs. The aim is to make cars affordable to China’s emerging middle class, people who are earning 50,000 to 60,000 yuan a year ($7,900-$9,500).
“It’s not copying. It’s not that simple any more,” said Wang Kejian, president of CH-Auto, a former Beijing Jeep engineer who was trained for a time in Detroit by Chrysler. “Since Chinese car makers have no accumulated vehicle design technology or know-how, we have to develop our own by studying foreign cars and use local parts suppliers to approximate the components and the cars.”
Geely Automobile, which owns Swedish carmaker Volvo, turned to CH-Auto around 2005 for help on a project that led to the Panda, now one of China’s most popular small cars. CH-Auto was responsible for the exterior styling and engineering the underpinnings. The rest was handled by Geely, according to the two companies.
CH-Auto and Geely made a clear departure from copying with the Panda. To be sure, they still selected a car to emulate or benchmark – in this case, the Aygo, a “city car” that Toyota produces in Czech Republic and has been selling in Europe since 2005.
But instead of simply producing a fake Aygo, engineers at CH-Auto first studied and tested the Aygo and its components – often with the help of three-dimensional digital scanners – to collect data on their design and performance. Then they tried to manufacture components by adapting parts made in China to match desired functions and performance. If suitable local parts weren’t available, they worked with suppliers to create new ones by simplifying the scanned Aygo designs.
The purpose was “not to copy but approximate the Aygo,” Mr. Dai said.
One example is the Panda’s chassis. The underbody carriage, to which the suspension and wheels are attached, is key to how a vehicle handles corners on the road.
The Aygo, which starts at £6,462 (about $10,000) in Britain, has a relatively sophisticated underbody structure formed in a single piece by using a process called “hydroforming,” in which pressurized water is used to shape metal. For the Chinese this was a problem.
CH-Auto and its chassis suppliers have no proven know-how in hydroforming. And the light-weight steel that Toyota uses for the Aygo’s underbody carriage was too pricey for Geely to use in a car to be sold in China.
Geely and CH-Auto’s solution was to use cheap “everyday” steel commonly available in China, Mr. Dai said. Geely and CH-Auto divided the Panda’s chassis frame into two pieces – upper and lower units – to simplify their structure so they could be easily stamped rather than using the more expensive hydroforming method. Then Geely welded those two pieces to create a chassis frame for the car.