Changan joins up with French maker
By Jin Jing |
July 10, 2010, Saturday
|
Print Edition
Print Edition
FRENCH car maker PSA Peugeot Citroen yesterday clinched a joint venture deal with China's Changan Automotive Group Co.
The joint venture, which still needs government approval, will have a total investment of 8.5 billion yuan (US$1.25 billion) and start production with the Citroen DS coupe, the companies said.
The new venture will also set up a technology center and produce models carrying Changan's own brand and the Peugeot brand.
"PSA is not at a competitive position in China compared with General Motors and Volkswagen," said Cao He, an auto analyst from Mingzu Securities Co.
"The new joint venture brings new hope for the group as long as it can have a balanced development between its two Chinese partners."
In May, both companies agreed to sign a memo of understanding to form a 50-50 joint venture to make eco-friendly light commercial vehicles and passenger cars in China.
Yesterday's signing ceremony was attended by Wu Bangguo, chairman of the National People's Congress Standing Committee, Changan Auto Chairman Xu Bin and PSA President Philip Valan.
Teaming with Changan allows PSA to have its second Chinese venture in a bid to speed up its development and reshape its brand image in China, the world's largest auto market.
PSA already runs factories with China's Dongfeng Motor Group, assembling cars such as the Peugeot 307, 408 and Citroen C5.
Last year, the group's vehicle sales in China jumped 52 percent to about 272,000 units, lagging behind GM's 1.8 million units record.
Changan Auto, the Chinese partner of Ford Motor Corp and Mazda Motor Corp, also wants to lift its market competitiveness through the new cooperation and strengthen its self-brand car business.
Valan earlier said PSA aims to more than double its market share in China from last year's 3.6 percent to 10 percent by 2020 with a sales of 2 million units. Changan also aims to lift sales to 5 million units within 10 years.
PSA, France's biggest auto maker that just reported its best half-year sales record with a great contribution from the Chinese market, is looking at emerging markets to boost sales.
The joint venture, which still needs government approval, will have a total investment of 8.5 billion yuan (US$1.25 billion) and start production with the Citroen DS coupe, the companies said.
The new venture will also set up a technology center and produce models carrying Changan's own brand and the Peugeot brand.
"PSA is not at a competitive position in China compared with General Motors and Volkswagen," said Cao He, an auto analyst from Mingzu Securities Co.
"The new joint venture brings new hope for the group as long as it can have a balanced development between its two Chinese partners."
In May, both companies agreed to sign a memo of understanding to form a 50-50 joint venture to make eco-friendly light commercial vehicles and passenger cars in China.
Yesterday's signing ceremony was attended by Wu Bangguo, chairman of the National People's Congress Standing Committee, Changan Auto Chairman Xu Bin and PSA President Philip Valan.
Teaming with Changan allows PSA to have its second Chinese venture in a bid to speed up its development and reshape its brand image in China, the world's largest auto market.
PSA already runs factories with China's Dongfeng Motor Group, assembling cars such as the Peugeot 307, 408 and Citroen C5.
Last year, the group's vehicle sales in China jumped 52 percent to about 272,000 units, lagging behind GM's 1.8 million units record.
Changan Auto, the Chinese partner of Ford Motor Corp and Mazda Motor Corp, also wants to lift its market competitiveness through the new cooperation and strengthen its self-brand car business.
Valan earlier said PSA aims to more than double its market share in China from last year's 3.6 percent to 10 percent by 2020 with a sales of 2 million units. Changan also aims to lift sales to 5 million units within 10 years.
PSA, France's biggest auto maker that just reported its best half-year sales record with a great contribution from the Chinese market, is looking at emerging markets to boost sales.
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