Mitsubishi may not invest more in Changfeng Motor.
October 19, 2009
Mitsubishi Motors has not decided yet whether to invest more in Hunan Changfeng Motor, after the latter is acquired by Guangzhou Automobile Group, SinoCast Daily reported recently, citing a top executive of Mitsubishi Motor Sales (China) Co.
Changfeng Motor, based in the central Chinese city of Changsha, Hunan province, expects to cooperate further with Mitsubishi Motors for a sharper competitive edge, but no substantial progress was made. That partly accounts for Changfeng's shift of its focus onto Guangzhou Auto.
In late June 2009, the technology transfer contract between the Japanese automaker and Changfeng Motor expired, and Mitsubishi Motors declined to make a renewal. The Hunan government therefore strongly supports the merger of Changfeng Motor into Guangzhou Auto for its automaker's development of own-brand models.
After a 29% stake in Changfeng Motor was sold to Guangzhou Auto, which will become the Hunan car company's biggest shareholder, 14.59% of Changfeng Motor will be still held by Mitsubishi Motors. The rest will be owned by Changfeng's parent company.
In China's auto industry, Mitsubishi Motors also keeps a close partnership with South East (Fujian) Motor. Presently, some of its distributors sell the imported Mitsubishi-branded vehicles and the car models produced by its two Chinese auto ventures.
On October 13, Mitsubishi Motors unveiled the 2010 Outlander EX, indicating that it has preliminarily completed the SUV layout in China. The Japanese carmaker aims to sell 16,000 vehicles in China from April 2009 to March 2010.