GM and FAW drive into light truck JV
By Joyce Pan |
August 31, 2009, Monday
|
Print Edition
Print Edition
CHINESE auto maker FAW Group and General Motors Corp yesterday said they jointly invested 2 billion yuan (US$292 million) to set up a venture to produce light commercial vehicles.
The equally-owned venture, which has a registered capital of 1.2 billion yuan, will be located in Changchun, capital of Jilin Province, where FAW is also based.
"To expand into the truck segment in China is an important step to complete our portfolio here," said Kevin Wale, president and managing director of GM's China operations.
"Light trucks and vans play a significant role in China and other parts of the world and will become a key focus for our future growth."
The venture will use the existing factories owned by FAW-Hongta Yunnan Automobile Co and Harbin Light Vehicle Co, both FAW's subsidiaries, to make light-duty trucks and vans.
Wale said annual capacity will exceed 100,000 units and is expected to double by the end of next year on completion of another assembly plant in Harbin, Heilongjiang Province.
Initially the venture will make vehicles under the FAW brand and focus on the domestic market, but vehicles carrying GM's brand may be rolled out later for export, Wale said.
Light commercial vehicles will be a key momentum for our growth while the partnership will help us compete better worldwide backed by GM's efficient global network, said Xu Jianyi, general manager of FAW.
Discussions on the venture began in early 2007 and it obtained regulatory approval last month, GM said.
Sales of commercial vehicles rose 5.47 percent to 1.82 million units in the first seven months in China, according to the China Association of Automobile Manufacturers.
The equally-owned venture, which has a registered capital of 1.2 billion yuan, will be located in Changchun, capital of Jilin Province, where FAW is also based.
"To expand into the truck segment in China is an important step to complete our portfolio here," said Kevin Wale, president and managing director of GM's China operations.
"Light trucks and vans play a significant role in China and other parts of the world and will become a key focus for our future growth."
The venture will use the existing factories owned by FAW-Hongta Yunnan Automobile Co and Harbin Light Vehicle Co, both FAW's subsidiaries, to make light-duty trucks and vans.
Wale said annual capacity will exceed 100,000 units and is expected to double by the end of next year on completion of another assembly plant in Harbin, Heilongjiang Province.
Initially the venture will make vehicles under the FAW brand and focus on the domestic market, but vehicles carrying GM's brand may be rolled out later for export, Wale said.
Light commercial vehicles will be a key momentum for our growth while the partnership will help us compete better worldwide backed by GM's efficient global network, said Xu Jianyi, general manager of FAW.
Discussions on the venture began in early 2007 and it obtained regulatory approval last month, GM said.
Sales of commercial vehicles rose 5.47 percent to 1.82 million units in the first seven months in China, according to the China Association of Automobile Manufacturers.
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