BEIJING (XFN-ASIA) - Nanjing Auto Group said it is open to further cooperation with Shanghai Automotive Industry Corp (SAIC) in the development of the MG Rover, the South China Morning Post reported, citing Nanjing Auto chairman Wang Haoliang.

Wang said any tieup has to suit the interests of MG Rover, adding that Nanjing Auto is not considering selling stakes to other parties.

Two years ago, Nanjing Auto outbid its SAIC for the assets and brand of the defunct UK-based automaker.

But SAIC shortly thereafter bought the intellectual property rights to MG's designs.

Lot's of press articles going round in China that SAIC and Nanjing are set to merge due to pressure from the Chinese government. If anyone see's anything can they post it here as I think we might see some movement soon.

Apparantly one of the drivers for this may be that SAIC are unable to make engines for the Roewe 750 without resorting to spending hours and hours hand building each engine. According to some reports I've read they are struggling with engine manufacturing and miscalculated that they could figure out how to do it by the time they used up a stock of 10,000 K series engines they bought of MG Rover!

Now they are running out of engines and NAC are the only people with the tech to provide replacements in big enough volumes. if SAIC fail to do a deal they may even have to halt production of the Roewe 750 (or at least make about 5 a day by hand). That's pretty humiliating for SAIC if true.

The K series is actually highly advanced in a number of ways. It's produces a lot of power from a vry compact unit. Maybe that's part of the issue?

Goodbye Roewe?

http://new.quote.com/stocks/story.action?id=XFN175h2931

:)

Wow, what a crazy twist to the situation!

If this news is true, it's mostly like for the best. Both sides should benefit greatly since I failed to see any down side to this. Hopefully this will speed up MG's coming to the US!!!

I don't see Roewe go away, but it does seem redundant. The market is not big enough for 2 new Chinese luxury car brands that are similar in design and engineering. Roewe can change directions and focus on comfort and luxury, while MG more sporty, that may be a good solution.

But why waste the money on Roewe when NAC own both Austin and MG which are both global brands. Far better to hand the Roewe development team and plans over to MG and Austin and just drop Roewe altogether.

Btw I note that a number of Chinese car makers including Geeley and Chery are talking to NAC about sourcing engines. Looks like Nanjing have hit the jackpot already! :)

2007/06/27

Auto rivals work on merger

"Shanghai Automotive Industry Corp (SAIC) has again extended an olive branch to Nanjing Automobile Corp (NAC), SAIC's bidding rival for the MG Rover project two years ago, in a move that's believed to result in a merger of the two automakers.

SAIC Chairman Hu Maoyuan told a shareholders' meeting last week that both SAIC and NAC hope to best utilize the domestic and global resources, cooperate and complement each other and avoid redundant construction. Hu also said both Shanghai and Nanjing governments have supported the move. Shanghai Vice-Mayor Hu Yanzhao led a delegation to Nanjing two weeks ago to work it out.

The central government, which has been pushing for consolidation of Chinese automakers, has also endorsed a merger. While both SAIC and NAC have been talking about cooperation, no tangible progress has been made so far. NAC Chairman Wang Haoliang, former deputy Party chief of Nanjing, had earlier said his company never shut the door for cooperation with SAIC. He said NAC wishes to jointly run the MG Mingjue project. Negotiations will determine if NAC will give up the controlling stake in the project.

Shanghai-based National Business Daily reported that a central government document about the merger of SAIC and NAC has already reached the Shanghai Municipal Government. The document ratified NAC as the base for MG Rover production, without clarifying the exact stake of each side. Industry analysts say the upcoming merger will create a win-win situation for both. While it will make both automakers more efficient, it will help NAC ease its financial strains in expanding MG production and help SAIC better tackle the world market with the MG brand.

The two automakers vied for Britain's automaker MG Rover in 2005. While NAC won MG Rover's fixed assets such as production lines and technology, SAIC got its design blueprints for two car models - Rover 25 and Rover 75 - as well as the intellectual property rights for all Rover auto engines. With Rover technology, SAIC launched its Roewe model last year and started marketing the sedan early this year. NAC also started selling its Ming Jue sedans three months ago. It's a sports model based on MG technology."


- China Daily -

Many MANY years ago i said this WOULD happen!
Mega

Goodbye Roewe?
http://new.quote.com/stocks/story.action?id=XFN175h2931
:)

Will the new company be called Chinese Leyland? Seems to be going that way.... perhaps the Indians can buy portions of the company in a decade after Chinese Leyland flops and ship the factories (and former British machinery) to India. Sort of like the opium-tea trade for the 21st century.

I can see Ashok Leyland lining up their bid right now.

SAIC cooperation with the leap (Yuejin) taken the first step, SAIC to eventually full integration into the South steam

http://auto.people.com.cn/GB/1049/6041112.html

PRC Shanghai, July 27 (Xinhua Shen Min) Today, Yuejin Automobile Group and the SAIC Group signed a letter of intent to cooperate. Under the Letter of Intent, Yuejin Automobile Group and the SAIC Group will be based on the principles of comprehensive cooperation, the establishment of a joint working group explore the auto, automobile parts, automobile service trade and other fields full cooperation and the possibility of the program, and the reorganization of assets related to the work to achieve the SAIC and the Southern Steam full integration.

Yuejin Group is the first Chinese car production one of the backbone enterprises, South subsidiaries of the Group of steam with a full range of automotive products research and development and manufacturing capacity. Under the Letter of Intent, Yuejin FAW Group and the Southern Group intends to conduct a reorganization of assets, Vehicle and parts of such businesses with SAIC for comprehensive cooperation. News analysis This will help improve the current SAIC "Rong-wei," and the Southern Steam "is Lord" two independent brands vehicle competition, for the integration of the two markets has laid a good foundation. SAIC is the world's top 500 enterprises. in 2006 to 1.34 million vehicle sales among the nation's first automobile enterprises, its holding 83.83% of a listed company Shanghai Automotive is China's biggest vehicle listed enterprises. As the controlling shareholder of the continued commitment of SAIC, Yuejin Automobile Group and the next group of assets to avoid a reorganization plan with Shanghai Automotive produced the same industry competition. They said that cooperation will be a strong alliance, it will be full cooperation. The two sides discussed cooperation on the basis of integration should be beneficial to both resources and accelerating autonomous capacity building; helps to reduce fixed assets investment, improving asset utilization efficiency; The two sides are conducive to the realization of enterprises optimize resource allocation, In research and development, procurement, production and sales of synergies; will enrich our product mix, improve our own brands, value, so as to achieve a win-win situation. The two sides to explore cooperation with the countries of the Yangtze River Delta regional economic cooperation guidelines with the automobile industry development policy, both business development and cooperation between the two sides explored has been two to the support of the government. Letter of Intent was signed, the two sides will set up a working group on the basis of the next step clearly the specific contents of the work, Fidelity launched the investigation and other related work.

"Two of China's biggest domestic car companies have formed a partnership to develop new models amid Chinese efforts to create producers able to compete with global automakers. Shanghai Automotive Industries Corp. and Nanjing Automobile Corp. agreed to "comprehensive cooperation" on design, production and sales, Nanjing Auto said in a statement issued over the weekend.

A woman who answered the phone Monday at Nanjing Auto's publicity department refused to give other details and calls to SAIC were not answered. The communist Beijing government has been encouraging such tie-ups in its fragmented auto industry, hoping Chinese producers will pool resources to create competitive models.

China is the world's second-largest and fastest-growing vehicle market, but sales are dominated by General Motors Corp., Volkswagen AG and other foreign producers. The country has about 150 automakers, most small and financially weak. Passenger car sales to newly prosperous Chinese drivers rose 37 percent last year to 3.8 million units, according to the country's auto industry association. Total vehicle sales, including trucks and buses, rose 25.1 percent to 7.2 million units.

Nanjing Auto and SAIC, both government-owned, said earlier they were looking at cooperating to make better use of limited resources. The weekend announcement said they were looking at an asset swap but made no mention of whether they were discussing an outright merger.

Nanjing Auto, China's oldest domestic automaker, is the local partner of Italy's Fiat SpA. The company, based in the eastern city of Nanjing, struck out on its own last year, relaunching the MG sports car after buying the brand from its defunct British owner, MG Rover Group. SAIC is the local partner of GM and Volkswagen but has begun selling cars under its own Roewe brand. The Roewe is based on the Rover 25 and 75, which SAIC bought from the British producer.

China's biggest domestic automaker is Chery Automobile Co., with 8.3 percent of sales last year, but most Chinese producers have less than 1 percent, according to research firm J.D. Power & Associates. Volkswagen was the country's biggest seller, with a 17 percent market share, while GM had 9.7 percent."

http://www.detnews.com/apps/pbcs.dll/article?AID=/20070730/UPDATE/707300385/1148/rss25

-------------------

Chinese general motors, anyone? :nod:

Goodbye Roewe hello Austin?

big progress for SAIC-NAC those days...

sooner or later we will get good news for the cooperation.

9th November 2007

A Reuters report yesterday quoted an unnamed SAIC employee as saying that Shanghai Automotive Industry Corp. and Nanjing Automobile Corp., which both make Rover 75-derived cars, were in the final stages of completing their audits and asset valuations before a planned but still not timetabled or structured merger, which would be the first of its kind and scale in China’s still highly-populated domestic automotive sector.

Also this week, the Shanghai Securities News reported that Fiat had started to withdraw its own employees from Nanjing Fiat, its loss-making joint venture with Nanjing Automobile, presaging a potential dissolution of the joint venture which Fiat’s CEO Sergio Marchionne warned in May this year was under review, before signing an MOU for another JV with Chery in August.

Meanwhile, Motortrader.com reported today that Nanging’s NAC MG is claiming interest from over 100 UK dealers in representing the MG TF franchise, and has received over 40 letters of intent. NAC MG hopes to have 50 franchises in place in the UK when the MG TF is re-launched early next year. Limited CKD production is getting underway at the former Longbridge MG-Rover production facility.

SAIC, Nanjing due diligence process nears completion.

The due diligence process that could signal a merger of Shanghai Automotive Industry Group (SAIC) and Nanjing Automobile Group is nearing completion, Chinese media reported.

An unnamed spokesperson for SAIC said that the two sides are "in the final stages of their audits and asset evaluations", but "still need to work on some technical details". The spokesperson also said that there is no timetable for the merger, however other source said that the deal could be completed by the end of the year, as previously scheduled.

Among the options being considered are the rolling of Nanjing's production assets into those of SAIC, while a similar process would also take place for the pair's component supply assets. In return, Nanjing's parent company would take a stake in Shanghai Automotive or its listed unit, Shanghai Motor.

Shanghai Automotive Industry Group (SAIC) owns a total asset of 130 billion yuan ($17.54 bln), while the number for Nanjing Automotive Group is 12 billion yuan ($1.62 bln), official financial document revealed.

Talks have been taking place over a deal between the two Chinese automakers since the middle of the year, and the initial deadline for the completion of due diligence (1 October) was missed due to the sheer complexity of the two companies' assets. However, a report late last month suggested that the pair had talked about the possibility of SAIC's Volkswagen (VW) joint venture (JV) using the under-utilised plant of Nanjing's JV with Fiat.

soure: Gasgoo.com

SAIC, Nanjing Auto ready to reach a final tie-up.

China's biggest automobile industry group Shanghai Automotive Industry Corp (SAIC) and Nanjing Automobile (Group) Corp has completed a review of each other's assets, 21st Century Business Herald reported.

Sources familiar with the negotiations said that the two sides would unveil their assets evacuation reports by mid-December and may sign a final merger agreement before the end of this year.

During Wang Yaoping's visit last week, the two sides have agreed on major issues regarding the merger, such as an asset transferring. But they are still bargaining over shareholding ratio. Nanjing Auto aims to claim some 10% to 15% stake, which SAIC said is "overreaching."
A due diligence report on Nanjing Auto conducted in October by SAIC estimated the company's total assets of Nanjing Auto at US$350 million, which is very small compared with SAIC's US$5.4 billion.

The two parties will jointly develop MG and Roewe brands based on Rover technology following the merger. The two companies currently are sharing the same technology, derived from the now-defunct British carmaker MG Rover.

Nanjing Auto launched production of two MG sports car models earlier this year after acquiring the ownership of British bankrupt car maker MG Rover Group by overbidding SAIC in July 2005. SAIC bought the ownership of two Rover models but not the brand name; instead, the company made a new brand name: Roewe marque.

source: Gasgoo.com

Article from the Birmingham Post.

A full takeover of Nanjing Automobile by its domestic rival Shanghai Automotive will be sealed on Boxing Day, The Birmingham Post has learned. The two companies - which have competed over the MG Rover legacy - have agreed in principle to a merger to create a Chinese automotive giant. Under the terms of the deal Nanjing Automobile Corporation would own no more than 15 per cent of Shanghai Automotive Industry Corporation.

But sources said the deal would not affect NAC’s plans to restore vehicle production to Longbridge and relaunch its version of the MG TF early next year. The deal would create the biggest Chinese automotive maker, with a combined production of more than 1.6 million vehicles. It would be a step towards creating a national Chinese car champion that would eventually compete head-on with global giants.

The Beijing government is seeking to strengthen the industry by encouraging tie-ups and mergers. No names have been decided for the new joint company, although East Ocean Company is among those under consideration. A source said: ‘This will be good news for Longbridge. SAIC will bring more products and volumes at Longbridge will be higher than before. It is a logical move. SAIC is much bigger than NAC and has more money. Joint groups could work together on the engineering and research and development.’

The takeover could also pave the way for NAC’s blueprint for Longbridge, which will see part of its portion of the old South Works site redeveloped. A new design centre could be set up, to house the 250 engineers who have been working for SAIC at Ricardo’s site in Leamington. The source added: ‘Instead of having two separate R&D centres there could now be one. The total investment in R&D, manufacturing and sales and marketing will go up.’

No new buildings will be constructed under the blueprint, although existing offices will be refurbished. The blueprint will also include greater capacity for production and a better logistics and quality control. This will be necessary as part of the plan is to source more components from China to ensure profitability and reduce the problems the firm has had with defective parts imported from the Far East.

Broken windscreens were among the parts which delayed the relaunch of the TF from this year into 2008. SAIC is thought to have said it does not want to interfere with NAC’s plans. The source said: ‘SAIC respect NAC’s plans but will look at how to improve things in the future. That is the Chinese way, one firm will not say ‘I am the boss’, they will co-operate.’

The long delayed relaunch of the MG TF will still go ahead at either the end of February or the beginning of March under the plan. But the deal, although a takeover, has been approved by both companies. ‘It is like a marriage. If you want to marry someone it is impossible if the other person doesn’t like the other one. Once these companies were competitors, now they have become part of one family, which is very good for sales and marketing for example. Of course this is good news for Longbridge, because it means a bigger firm. It means there is going to be more money to develop the next generation of cars. SAIC has some very big ambitions to redevelop this area. It will be giant company,’ the source added.

A spokeswoman for SAIC said: ‘Apart from a July 26 letter of intent to cooperate with Nanjing Auto, no new agreement has been signed so far.’ She said she did not know when a deal might be announced.

SAIC’s ventures with General Motors and Volkswagen are China’s biggest car sellers, with combined sales of 441,584 cars in the first half of 2007, or 14 per cent of the market. But the company faces tough competition in the commercial vehicle area from local rivals FAW Group and Dongfeng Motor. Nanjing Auto’s MG brand cars, Yuejin light trucks and Iveco light buses could be valuable additions to SAIC’s portfolio.

According to China Car Times the deal is done - SAIC will take over Nanjing.

December 26th, 2007 - Today marks a very special day in Chiinese automotive history. Bosses of both SAIC and NAC met at the Beijing Diao Yu Tai state hotel to sign an agreement that will see Nanjing Automotive Corporation become part of Shanghai Automotive Industry Corporation.

SAIC will reward NAC with no more than 8% of shares in SAIC, in return NAC will hand over all of its assets. The deal is supposed to worth in the region of 14 billion RMB (1.9 Billion USD)

The deal will be formally wound up before the end of 2008, as the deal needs the Chinese governments regulatory approval. When the deal is completed, SAIC and NAC combined will be the biggest Chinese automotive company in China.

China is slowly opening its automotive market (as is expected of it by the WTO), the 2nd largest in the world, to foreign competitors, China realizes that it needs a large domestic company to take on the likes of GM in the domestic market, and eventually abroad.

EDIT: news from Autoblog:
Dec. 27th, 2007 - The twisted saga of MG's resurrection from the ashes at the hands of Chinese automakers has come full circle. Last year both SAIC Motor Corp. and Nanjing Automobile Corp. fought tooth and nail for the right to build MGs in England, and Nanjing, the smaller of the two automakers by far, won. Since then the Chinese automaker has been trying to begin production of a new MG roadster at the company's plant in Longbridge, England. SAIC, meanwhile, accepted the defeat and instead purchased some MG production equipment and began building Rover sedans in China under the Roewe name (Ford had cleverly exercised its option to purchase the Rover name from BMW, which meant that SAIC had to name its Rover sedans something else).

SAIC has gotten the last laugh, however, with its recent purchase of Nanjing. Nanjing bought Rover for an estimated $100 million back in 2005, while SAIC reportedly has agreed to pay around $1.9 billion for Nanjing.This means that everything SAIC lost out on in the bidding war over MG it has gained by acquiring Nanjing. Most importantly, this includes the Longbridge production facility. SAIC already has an R&D center in Britain, which it will consolidate with the Longbridge facility and use to begin production of vehicles in Europe. The automaker claims production of the MG roadster, as well as other MG models, will begin soon, though SAIC can also use those facilities for development and production of new vehicles for the European market sold under its own name. Why is MG so darn important to these Chinese automakers? As an established European brand with some street cred, MG is a small company that offers the Chinese an easy way into the lucrative European market. Perhaps instead of Rovers, we'll soon see Roewe sedans on the streets of London.

SAIC and Nanjing MG hooking up in the UK this week to discuss making cars

SAIC and NAC MG officials are reportedly planning to meet up this week to discuss how the two companies plan to merge their UK operations. SAIC took control of the Ricardo 2010 development center (which is now known as the SAIC R&D center) in the UK via a deal with Ricardo in 2007 , and NAC MG have the world famous Longbridge factory located in Birmingham. How the two plan to merge their assets in the UK is of great interest to MG fans the world over, rumors are floating that the sexy Roewe 550 could be badged as the MG5 for the Euro markets, but other sources are saying that Ssangyong will be used to spearhead the Roewe push into Europe. China Car Times would like to see the MG marque flourish again, Ssangyong do make some great cars, but the MG badge has a hundred years of history and brand recognition. Come on SAIC, roll out the MG5!

The below gives information on the SAIC/NAC plans to meet up and finally give some direction to the European production of Chinese cars, hopefully ending the MG wilderness years.

Chinese to decide UK factory’s future
Nanjing–SAIC must decide on models, volumes at Longbridge plant

Tony Lewin
Automotive News Europe
February 6, 12:57 CET

A high-level delegation of executives from Shanghai Automobile Industry Corp. is in the UK this week to discuss the integration of its local operations with those of Nanjing Automobile.

SAIC took over Nanjing late last year. The deal has delayed Nanjing’s planned restart of production at the former MG Rover plant in Longbridge, central England.

No cars have been assembled there since the factory’s grand reopening in May last year. Nanjing got control of the factory in 2005 when it bought the assets of MG Rover, which collapsed because of financial problems.

The Shanghai Auto delegation will meet Nanjing managers at Longbridge and visit SAIC’s own vehicle development base at nearby Leamington Spa, said an official close to Nanjing.

The executives will decide on the carmaker’s future model policy for Europe and determine which models will be assembled at the Longbridge factory. Nanjing’s plans for the plant have never been truly clear beyond the promise to build a limited volume of the MG TF roadster.

‘Crucial time’

One executive close to the process was optimistic that a decision on future models and production volumes would result from the delegation’s visit.

” Now is a fairly crucial time in the process,” he told Automotive News Europe.

Up to three volume models could be built at the Longbridge plant, Eleanor de la Haye, Nanjing’s Longbridge spokeswoman, said.

Last month, SAIC Motor President Chen Hong said SAIC aims to restore production of original MG models in Longbridge soon. It also plans new MG models for Europe, he said.

“The British business will become SAIC’s new platform for overseas markets and a window for SAIC to Europe.”

In 2005, Nanjing beat SAIC in a bidding war for MG Rover. Soon after the acquisition Nanjing started looking for a financial partner to help it relaunch Longbridge production. Industry observers said Nanjing did not have the financial resources to revive volume production at the plant.

Car production started in Longbridge in 1905. At its height in the 1960s the factory was one of Europe’s biggest plants, building more than 360,000 Austin, Morris and MG cars annually.

source: China Car Times

After reading the various posts in this thread, I'm very curious as to where the speculation about the Chinese Government forcing a merger of these two companies is coming from. I ask because, if this is true- there seams to be a pattern emerging wherein European and American subsidiaries seem to be favored over wholey owned Chinese entities. Moreover, the gear up seems to be aimed at the American market as a sales target.
Granted, my expertise as a world class product specialist is almost two decades behind me, but this strategem appears to be a huge faux pas considering the US economy is in terrible shape with no signs of recovery in sight. Meaning, of course Chinese Automakers can make some very modest in-roads on the very lowest end economy oriented vehicles over here. However, the REAL MARKET GROWTH OPPORTUNITIES are in China (where there is still a manufacturing base and solid economic growth).
In sum, my question is why gear up production for sales in an overglutted, anemic, dying market (US) when the real market growth is right in China? With almost 50% growth of domestic sales, the question should be "Who are the Chinese buyers likely to be this year (what is the entry level buyer after)? The follow up question ought to be based on a five year projection about the kind of emissions placing this number of drivers on the road will generate (in China and around the world)? Ultimately, all answers MUST lead to electric and hydro vehicles for the future- not regurgited old technology to perpetuate an already overcrowded market place.
If the Chinese Government is going to endorse technology at the corporate level- why should it be yesterday's news? Why doesn't China (with the Olympics right around the corner) endorse clean and affordable electric technology? The cost of building a viable electric vehicle is actually lower than internal combustion vehicles- ask BYD and GO GREEN!:D

i thought this deal was done a while back, guess not

SHANGHAI, Feb 25, 2008 (SinoCast via COMTEX) -- SAIUF | news | PowerRating | PR Charts -- Shanghai Automotive Industry Corporation (Group) (SAIC) and Nanjing Automobile (Group) Corporation will tie the knots legally as early as April 2008 as Yuejin Automobile Co., Ltd. has bought up the Nanjing-based company and Nanjing MG Automobile Co., Ltd.

Yuejin Automobile has totally controlled Nanjing Automobile Group after spending CNY 5.7383 billion acquiring an 83.147% stake in the latter from the its former four shareholders, including Yuejin Motor (Group) Corporation and China Huarong Asset Management Corporation. It has also totally owned Nanjing MG Automobile after buying 67.78% of the latter for over CNY 2.7 billion from five previous shareholders including the development corporation of Nanjing Jiangning Economic & Technological Development Zone and Jiangsu Communications Holding Co.
source:tradingmarkets.com

i thought this deal was done a while back, guess not
Wasn't due to be complete until June, at the moment there is just an agreement and both companies are busy rearranging themselves so that it will be a simple transfer when the time comes.




http://www.tradingmarkets.com/.site/news/Stock%20News/1130178/

NANJING, Feb 25, 2008 (SinoCast China Transportation Watch via COMTEX) -- SAIUF (http://www.tradingmarkets.com/.site/stocks/quotes/goto~www.tradingmarkets.com~redirect.cfm?symbol=SA IUF) | news (http://app.quotemedia.com/quotetools/clientForward?targetURL=http://www.tradingmarkets.com/.site/stocks/quotescharts/&action=showNews&symbol=SAIUF) | PowerRating (http://www.tradingmarkets.com/.site/powerratings?sym=SAIUF) | PR Charts (http://javascript<b></b>:openprcharts() -- Chinese automaker Shanghai Automotive Industry Corp. (SAIC) expects to close the acquisition of its domestic peer Nanjing Automobile Corp. (NAC) in April 2008.

The company (http://www.tradingmarkets.com/.site/news/Stock%20News/1130178/#) entered into an agreement with Yuejin Motor Group, parent company of NAC, to acquire the latter's core auto assets at the end of December 2007.
The targeted assets include both the 100 percent stake Yuejin Motor owned in NAC Nanjing MG.
The vehicle assets and major auto parts assets will become a part of SAIC Motor Corp. Ltd. (SHSE: 600104), a listed arm of SAIC, and other auto parts assets and service & trade assets will be under the aegis of Donghua Co., Ltd., a 75-25 auto parts joint venture between SAIC and Yuejin Motor.
In order to complete the assets transfer smoothly, Yuejin Motor also made a series of internal share transfers.
It took over a total of 83.147 percent stake in NAC from four of the latter's shareholders for CNY 5.7383 billion, making NAC its 100 percent-owned subsidiary.
The four NAC shareholders are Yuejin Motor (Group) Corp., China Huarong Asset Management Corp., Jiangsu Guoxin Investment Group Ltd. and Jiangsu Communications Holdings Co., Ltd.
In the meantime, it purchased a 67.78 percent stake in Nanjing MG from five of the latter's shareholders for CNY 2.7 billion, making Nanjing MG its fully-owned subsidiary.
The five Nanjing MG shareholders are Nanjing Jiangning Economic and Technological Development Corp., Nanjing Hi-tech Economic Development Corp., Nanjing Pukou State-owned Assets Investment and Management Co., Ltd., Jiangsu Guoxin Investment Group Ltd. and Jiangsu Communications Holdings Co., Ltd.
After the acquisition of the core auto assets of Yuejin Motor, SAIC will own not only Roewe but also MG, the two Chinese proprietary brands.
The two brands will share not only the same production line but also the same R&D platform, which will bring an inside resource reorganization in SAIC, pointed out industry experts.
SAIC launched its first self-branded car, Roewe 750, in the second half of 2006 and NAC rolled out MG7, a five-seat, four- door sedan, in March 2007.
NAC acquired the MG, a closed plant in Longbridge, England, and Powertrain, the engine unit of collapsed British automaker MG Rover, for approximately GBP 53 million in July 2005.
SAIC bought the Rover 75 and 25 sedan technology as well as K-series engines from MG Rover for about GBP 67 million in 2004.
Therefore, Roewe sedan, based on Rover 75 technology, had been seen as a rival to NAC's MG7 series sedan.

They are moving in the right direction.

Article about future plans of MG and Roewe at China Car Times:

MG going global, Roewe to stay at home?

AROnline has just obtained an English language translation of a recent and revealing interview given by Dr. Gao Weimin, the Manager of SAIC Motor Corporation Limited’s (SAIC Motor’s) Technical Centres (and Chairman of SAIC Motor UK Technical Centre Limited), to a reporter from the Beijing Youth Daily.

Dr. Gao, who had a six-year stint as Deputy Manager of Pan Asia Automotive Technical Center Limited (a 50-50 JV between GM and SAIC Motor) before starting his present job, now has responsibility for managing SAIC Motor’s four Technical Centres at Nanjing and Shanghai in China, Leamington Spa in England and Pyungtaek in South Korea in addition to overseeing the implementation of a three year Future Product Programme based on six platforms, ten different engines and three separate transmissions.

SAIC Motor’s original intention was to develop a total of five platforms, for the following models, by 2010:

- a B segment supermini,
- a C segment, Roewe 550-based, series,
- a D segment, Roewe 750 derivative series,
- an E segment large car series and
- an SUV series.

However, Dr. Gao stated that, since the acquisition of MG, a sixth platform had been added to the Future Product Programme: ‘The sixth platform is a sportscar platform. The Roewe brand had no space for a sportscar, so the sportscar platform will go to MG.’

Dr. Gao also revealed that a total of ten new engines are to be rolled out over a five year period and that these will include all new families of 1.3- and 1.6-litre four cylinder, 2-litre and 2.4-litre four cylinder and 3-litre and 3.6-litre V6 cylinder petrol engines. Dr. Gao added that SAIC Motor are working on alternative powertrains using CNG and hybrid systems and that the company also has access to a range of diesel engines by virtue of a controlling stake in South Korea’s SsangYong Motor Company.

SAIC Motor’s Technical Centres are also developing three new transmissions. Dr. Gao said that: ‘We’re designing gearboxes according to the size of the engines. We’re working on a six speed manual with a range from 200nm to 400nm. Automatic gearboxes are also being developed.’ The Beijing Youth Daily article claims that the range of engines and gearboxes are expected to be put into production by early next year.

Dr. Gao also told the Beijing Youth Daily’s interviewer about the future division of responsibility between SAIC Motor’s Technical Centres. The Technical Centre in Shanghai’s main focus will be on the development of the Roewe brand and the design of flagship models. However, following the integration of the Nanjing-based Technical Team, the Shanghai Technical Centre will also assume responsibility for the MG platforms. SsangYong’s Technical Centre will concentrate on designing cars to meet the specific needs of the South Korean market while the European Technical Team, based at SAIC Motor UK Technical Centre Limited’s premises at Leamington Spa in England, will be working primarily on cutting-edge technologies and their initial application to SAIC Motor’s new products.

The Beijing Youth Daily’s reporter also discussed the ‘brand positioning struggle between the MG and the Roewe brands’ with Dr. Gao who indicated that NAC MG and SAIC Motor had completed a joint appraisal of the respective brands’ attributes and had now clearly mapped out their positioning. Dr. Gao specifically confirmed that MG will be a sports brand and that the MG range will be targeted at consumers who appreciate a sportscar.

Dr. Gao added that: ‘Introducing a brand that no one has any connection to would not be a great idea – to persuade people to buy a car from a new brand would need a lot of time and, more importantly, a lot of money. Now with MG, we can take that brand global. No matter whether the cars are made overseas, or merely sold overseas, we will sell them under the MG brand.’ He also confirmed that SAIC Motor UK Technical Centre Limited will be responsible for the design and development of all the MG models based on the six platforms mentioned above and intended for sale in Britain and Europe.

AROnline’s own, independent, research indicates that the Beijing Youth Daily’s article accurately represents SAIC Motor’s overall strategy for the MG brand. However, certain elements of the projected timetable might yet prove to be a tad optimistic because the specific details of the MG Brand Development Strategy and Future Product Programme have still to be finalised.

Interestingly, SAIC Motor UK Technical Centre Limited was awarded the Chinese Inward Investor of the Year Award at last month’s KPMG China Business Awards 2008 Dinner in London. Dr. Gao, the company’s Chairman, was presented with the award by Lord Digby Jones of Birmingham, Minister of State for Trade. (See photo above)

AROnline reckons that the award provides some tangible evidence of SAIC Motor’s commitment to Britain as a base for the European relaunch of MG and that Dr. Gao’s remarks suggest that a degree of cautious optimism about the future of the famous marque might be justified.