Gasgoo.com (Shanghai October 21) - Facing an ever competitive market, Jianghuai Automobiles has been embarking on new expansion projects. In a report appearing in the Nanfang Daily earlier this week, the Anhui-based manufacturer announced that it will be spending over 160 million yuan ($25.42m) to purchase shares in both Yangzhou Light Automobile and subsidiary Jianghuai Anchi. Following the purchase, JAC will have access to two new production sites, which will help it decrease its overall costs.
JAC's decision to purchase shares in the two companies was passed by its board of directors earlier this week. The board agreed to use cash to fulfill the purchases, which will see its stakes in Yangzhou Light Automobile and Jianghuai Anchi rise to 67 percent and 100 percent, respectively. JAC's original stake in Anchi, which was established in 2010 as a SUV and pickup truck manufacturer, was 90 percent. Following the acquisition, the added value rate of Anchi's stock is evaluated to be 14 percent.
JAC was one of the better performing domestic manufacturers in September, having managed to sell a total of 11,606 vehicles. JAC's sales grew 65.28 percent from August to September and 33.19 percent from September 2011 to September of this year. Compared with average industry growth rate of 38.7 percent and 11.4 percent, JAC's performance was exceptionally strong. Sales of its flagship Heyue sedan (pictured) were very good, with a total of 8,334 units sold during the month. The manufacturer's commercial vehicle sales were also notable.
JAC's reported stock price rose from 4.3 yuan ($0.6832) at the end of August to 5.33 yuan ($0.8468) this past Wednesday.
