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Mitsubishi partners with Changfeng Motors

From Autoblog

Forming a joint-venture with a Chinese partner seems to be the order of the day for most carmakers around the world. The latest company to join the bandwagon is Mitsubishi, which has announced that it will partner with Hunan Changfeng Motors to manufacture a range of Mitsu-branded sedans for the Chinese domestic market.

Changfeng has already worked with Mitsubishi in the past, building versions of the Pajero SUV, but this time 'round the two will be forming a 50-50 joint venture to produce a range of new vehicles. According to Chen Zhengchu, Changfeng's General Manager, the deal could potentially see Mitsubishi's Chinese production rise to roughly 100,000 cars annually and should rise further in ensuing years.

Most analysts consider the deal a win for both sides. Mitsubishi gets a stronger foothold in the rapidly expanding Chinese market, while Changfeng's rep will improve in the international spotlight. As it stands, both parties are still at the negotiating table and an application has been sent to industry regulators.
 

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From Global Auto Sourcing:

December 19, 2007 – Japanese automaker Mitsubishi is planning to form a 50-50 joint venture with Chinese automaker Changfeng, Chinese web media sina.com reported today.

"Changfeng is planning to have substantial negotiations with Mitsubishi over the projected joint venture project," said Chen Zhengchu, general manager of the Hunan-based Changfeng Motors. "We are going to form a 50-50 joint venture with Mitsubishi and as such, we will make some adjustments on our investment structure accordingly."

The two sides are enthusiastic over forming a joint venture company, but there are a lot of things to prepare, Chen said.

There are differences that must be ironed out between the two partners before the joint venture can be formed, the Sina.com report said.

Mitsubishi plans to produce sedan and MPV models with another partner, the Fujian-based Southeast Motors and it hopes Changfeng concentrates on the production of SUV vehicles. However, Changfeng has its own agenda: it hopes to produce sedan vehicles too.

Currently, Changfeng has an annual capacity to produce 100,000 vehicles. With the completion of its new production base at Yongzhou, Hunan province, the automaker will have a total capacity of 200,000 vehicles.

Currently Changfeng produces a SUV vehicle Liebao on its own and Pajero SUV for Mitsubishi.
 

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Mitsubishi's new Chinese JV plan may hit bumpy road ahead!

January 17, 2008 - Mitsubishi Motors' longstanding plan to set up a new joint venture automaker in China now runs into snags, as the program may be blocked by China's auto industry regulations, the Shanghai-based Oriental Morning Post reported today.

"We are still studying the joint venture plan," said Hiromi Endo, general manager of Mitsubishi Motors Beijing Office, who didn't explain how to bypass the regulation problems.

Under the Revised Regulations on Automotive Industry stipulated by central government in late 2006, new players must have at least a total investment of 4 billion yuan ($550.7 million) in order to enter the auto-making industry. Besides that, passenger vehicle makers must have engine-making facilities with total investment of no less than 1.5 billion yuan ($206.5 million).

But the two parties, Mitsubishi and Hunan Changfeng Motors currently fail to find an engine plant as required by the policy.

"We’ll try our best to meet the government requirements so as to start the joint venture as early as possible," an unnamed Changfeng official.

Earlier reports revealed that the JV would be a 50:50 alliance. And it would build sedans and sports-utility vehicles (SUVs) if approved.

Mitsubishi already owns a 16.07% stake in Hunan Changfeng, but this deal would consolidate the their partnership. Changfeng now builds Pajero and Pajero Pinin that sold in Chinese market.
source: Gasgoo.com
 

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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.

http://autonews.gasgoo.com/auto-news/1012589/Mitsubishi-may-not-invest-more-in-Changfeng-Motor.html
 
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