Officials from the city and the world's biggest ocean-going vehicle carrier meet today to discuss the Nansha port project Nippon Yusen Kaisha (NYK Line), the world's biggest ocean-going car carrier by volume, is in talks with Guangzhou municipal and maritime authorities to build a joint-venture car terminal at the port of Nansha. 'We will be meeting with the city and the Guangzhou Port Authority and we hope to come to an agreement to participate in the development of a car terminal which would both import and export vehicles,' NYK president Koji Miyahara said yesterday. Guangzhou has only recently established itself as a significant car production centre, thanks to major investments in the city by Honda Motor, Nissan Motor and Toyota Motor Corp. It is now seeking to capture a share of the international export market. Honda and Toyota are building export-oriented plants in the city. The talks also highlight the degree to which Japanese carmakers - by first attracting a network of Japanese suppliers and potentially a shipping line - are rapidly copying their famed keiretsu manufacturing system in the Pearl River Delta region. 'We have a very strong relationship with Japanese carmakers and they have been asking us to assist with their new ventures in China,' Mr Miyahara said. 'We hope to have the agreement in Guangzhou in place within three to six months.' Mr Miyahara declined to reveal investment numbers or the potential shareholding structure but said he would meet Guangzhou mayor Zhang Guangning today to discuss the project, which might include Hong Kong-listed terminal operator Cosco Pacific as a partner. 'Cosco works with NYK in running two berths dedicated to vehicle transport in Dalian,' said Raymond Yuan, Cosco Pacific's general manager for communications. 'We are looking for further co-operation with NYK in operating berths for cars in other parts in China, including Guangzhou.' Mainland car production has focused on feeding the voracious appetites of China's emerging middle class. According to an April report by Deutsche Bank, car dealers in Guangzhou and Shenzhen sold 126,000 vehicles last year, up a comparative 72 per cent year on year. However, exports of vehicles made in south China are expected to begin to rise this year once a joint venture between Honda and the Guangzhou Automobile Industry Group begins to produce cars made for European consumers. Guangzhou Honda started domestic production two years ago with an annual capacity of 240,000 units. It will later this year open a plant with minority shareholder Dongfeng Motor dedicated to exports, with an annual production capacity of 50,000 units. While Mr Miyahara declined to quantify NYK's potential investment in the project, its involvement in mainland car terminals has ranged from 5 per cent in a Shanghai venture to 30 per cent of the facility in Dalian. He said NYK, which moved 26 per cent of the world's passenger cars to market last year, would also add two vessels to the car-carrying fleet of Nykcos Car Carrier, its 49 per cent held joint venture with the China Ocean Shipping (Group) dedicated to transporting mainland domestic trade. NYK's potential investment in Guangzhou also highlights the city's port development strategy in Nansha, where constant silting and shallow water depths make it difficult for large container ships to call at the port. Despite their massive size, the car transport vessels operated by NYK and other shipping lines are wider and draw less water than their container-carrying counterparts. Foreign partnerships 1985: Peugeot and Guangzhou Automotive Group set up joint-venture plant in Guangzhou with Beijing's blessing to produce as many as 30,000 cars a year. Only 16,400 were made in 1993 - its highest annual output July 1998: Honda Motor sets up joint venture with Guangzhou Automotive in Guangzhou by taking over assets of the ill-fated joint venture between Peugeot and Guangzhou Automotive. It now has annual capacity to make 240,000 units of Accord, Fit and Odyssey cars Nov 2002: Honda, Dongfeng Motor and Guangzhou Automotive receive the green light to set up China's first foreign majority owned car plant. It will be completed by the end of this year and will export only June 2003: Nissan Motor and Dongfeng Motor form joint venture in Huadu, Guangdong and Xiangfan, Hubei. It aims to sell 300,000 cars in 2007 March 2004: Toyota Motor Corp gets Beijing's approval to form joint venture with Guangzhou approval to form joint venture with Guangzhou Automotive to produce engines in Nansha. Initial annual capacity will be 300,000 units. Their joint venture to make up to 50,000 Camry cars a year is pending Beijing's approval
