Revival of Red Flag car brand

China's FAW Group, formerly called First Automotive Works, has started sales of its new Hongqi sedans in Beijing. The national brand has been revived to compete in the domestic luxury car market.

This is one of the oldest nameplates in Chinese automaker history.

First produced in 1958, the luxury sedan, whose name Hongqi means Red Flag in English, was test-driven by Chairman Mao Zedong.

Since then, it was designated as the official vehicle used in transporting visiting foreign dignitaries and Chinese leaders during the National Day Parade.

Now, the old brand has been relaunched. Its flagship Hongqi H7 Series sedans were made available to private consumers on May 30th.

Wang Longfang is the chief manager of the Beijing Hongqi Brand. He says the new sedan has attracted lots of attention.

"Over 20 cars have been sold in Beijing since they went on sale at the end of May. Provinces and central ministries have also passed orders. Sales could rise further as the production capacity increases. Our outlet in Beijing is located at the capital’s luxury business circle, right next to many foreign luxury brands. Our outlet has attracted the biggest crowds," Chief Manager of Beijing Hongqi Wang Longfang said.

The government has steered its new car domestically, away from the Audis and other foreign brands that have dominated over the last decade. Wang Longfang says the brand has what it takes to make its mark in the luxury market.

"The Hongqi flagship model H7 sells between 300,000 yuan to 480,000 yuan. That's much lower than what you would pay for similar foreign luxury cars such as the Audi A6. And Hongqi's prospects for the future are good, as it is technologically advanced," Chief Manager of Beijing Hongqi Wang Longfang said.

The Hongqi brand is expected to develop further, with China's FAW Group planning to invest at least 10.5 billion yuan more by 2015.

"Hongqi has a special place in the hearts of the Chinese public as a symbol of national pride. It's gaining momentum in its competition with foreign luxury brands to attract more domestic political elite and also private consumers. There is much anticipation on the old brands' revival, as the Red Flag is ready to fly high," CCTV reporter Su Yuting said.

China's ministry of foreign affairs has announced on Monday that, Wang Yi, the minister, has started using a Red Flag sedan as his official vehicle. After the announcement, stocks for China's FAW Group rose over three percent.