Shanghai. March 5 (Gasgoo.com) - Chery Automobile Co and the U.S.-based Quantum LLC have officially unveiled their joint venture plant in Wuhu, Anhui province, local newspaper reported today.
Quantum LLC, a subsidiary of Israel Corp, will spend US$225 million for a 45 percent stake in the joint venture firm and is also expected to provide an additional US$180 million guarantee to help Chery fund additional investment. Chery will invest US$270 million in terms of land and technology in return for a 55 percent stake of the joint venture.
The venture will make four new models, including sedans and sport-utility vehicles. The vehicles to be produced at the joint venture include 40,000 B21 vehicles, 25,000 B22 vehicles, 20,000 T21 vehicles and 65,000 M21 vehicles.
The joint venture will start operation by the end of 2009. Production capacity is expected to reach 150,000 units a year, lifting Chery's total annual output capacity to 500,000 vehicles.
The cooperation mode is claimed to be a first of its kind in China's automobile industry, where in the most case the foreign partner will finance a joint venture in terms of technologies.
Parent Israel Corp is one of Israel's major holding companies. Its main activities are focused on chemicals, shipping, oil and energy, advanced technology.
Last year, Chery sold a total number of 381,000 vehicles, up 24.8 percent from one year earlier, becoming China’s forth largest automaker in terms of sales.
The company exported 119,800 vehicles in 2007, up 132 percent from one year earlier. Chery has been China’s biggest sedan exporter for five years in a row.
Gasgoo: auto parts source
