China’s Great Wall Motor Says It’s Investigating Asbestos Report

Great Wall Motor Co. (2333) said it’s investigating a report by the Sydney Morning Herald that said its cars sold in Australia contained banned asbestos.

About 21,500 Great Wall vehicles and 2,250 made by Chery Automobile Co. may be recalled after asbestos was found in engine and exhaust gaskets, the newspaper reported yesterday. Ateco Automotive Pty, the importer of both brands, is working with government agencies including the Australian Competition and Consumer Commission and an announcement is expected within days, according to the report, which cited the company.

Shang Yugui, a spokesman for Great Wall, said the company is “aware of the report and trying to get more details.” Chery spokesman Jin Yibo didn’t answer two calls to his mobile phone. Two calls each to Ateco and the consumer commission outside of regular business hours weren’t answered.

Carmakers in China are expanding overseas to help offset slowing domestic sales as more plants open and local demand cools. Vehicle exports may rise about 50 percent this year, extending record shipments in 2011, according to the China Chamber of Commerce for the Import & Electronic Products.

Australia has banned all asbestos products since 2003, the newspaper said. The material, which is known to cause cancer, was previously commonly used in car components such as brake pads and various gaskets, according to the report.

Russia was the biggest export destination for China-made vehicles last year, while shipments to Brazil grew the fastest, according to the trade body.

To contact Bloomberg News staff for this story: Bonnie Cao in Shanghai at bcao4@bloomberg.net; Liza Lin in Shanghai at llin15@bloomberg.net

To contact the editor responsible for this story: Young-Sam Cho at ycho2@bloomberg.net

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