BMW to outsource China mini vehicle making to Great Wall

Lloyd Doyle
October 12, 2017

The stock jumped 14% on Wednesday after, a Chinese website, reported Great Wall and BMW would set up a joint venture in China and were selecting a venue to build a manufacturing plant. The prospective deal focuses specifically on electric vehicles, according to sources familiar with the matter. It is the country's second-largest premium brand after Volkswagen AG's (VOWG_p.DE) Audi AG.

It is believed that the new venture would aim to increase both BMW's production volumes and its EV share, as China prepares to introduce strict quotas on the percentage of plug-in offerings sold by auto makers.

"If an agreement were to be reached, we'd expect an arrangement like Denza (Mercedes-BYD), or VW-JAC, Ford-Zotye to be the most plausible outcome, whereby a new brand is used to sell EVs", they told Reuters, also suggesting new models could be sold under the Mini brand.

Trading would be suspended pending clarification of press articles, the company said. Representatives for BMW's China unit didn't immediately respond to an email seeking comments.

Great Wall, which doesn't have any carmaking partners, didn't make an immediate comment on the report yesterday.

Great Wall, which in August expressed an interest in the Jeep brand of Italian-American automaker Fiat Chrysler Automobiles NV's, is one of China's largest vehicle makers.

Regardless of whether the deal with Great Wall is successful, BMW's partnership with Brilliance is expected to continue.

BMW is now partnering with Brilliance China Automotive Holdings to produce a series of vehicles specific to the Chinese market, among them the 1 Series Sedan, X1 long wheelbase and the 5 Series Li.

Great Wall's Shanghai-listed shares have been suspended since late last month.

Brilliance China Automotive's shares were down 2.76 percent.

Other reports by Iphone Fresh

Discuss This Article