Shanghai, April 16 (Gasgoo.com) Mitsubishi Motors, a minor shareholder of GAC Changfeng Motor (former Hunan Changfeng Motor), recently didn't inject any money into the SUV-maker, and some insiders suppose that the Japanese company may withdraw from GAC Changfeng, its second Chinese venture, Search-Autoparts.com said.
Major shareholders Guangzhou Automobile Group Co. (GAC) and Changfeng Motor Group have recently injected $26.4 million into GAC Changfeng to improve liquidity of the joint venture. However, Mitsubishi Motors didn't joint in this capital injection program.
GAC last year bought a 29% stake in Changfeng Motor. Mitsubishi Motors would still hold 14.59% stake in the GAC-controlled company, continuing the technology transfer contract. GAC once discussed the capital injection with the Japanese counterpart, but Mitsubishi remained non-committal.
Changfeng-made Mitsubishi Pajero will change its brand to Changfeng Liebao, which will be seen as GAC Changfeng's proprietary brand in the future, indicating the Japanese carmaker would be unlikely to invest any more in Changfeng.
GAC Changfeng sold more than 30,000 vehicles last year, up 28%, but below its goal of 48,000, with net profits down 80%. To improve GAC Changfeng's profitability, its two parents have decided to inject capital into the company.
Mitsubishi Motors is in talks with SouthEast Motor on more its investment in the Fujian-based automaker, now 25%, 50% and 25% owned by Mitsubishi, Fujian Motor Group and Taiwan-based China Motor Corp, respectively.
