Gasgoo.com (Shanghai December 5) - SAIC has made yet another important step in expanding its overseas business, with the manufacturer announcing that it will be establishing a new joint venture company in Thailand, China Business News reported today. SAIC will cooperate with Thai conglomerate Charoen Pokphand to sell its own brand vehicles in Southeast Asian countries.
Both companies will initially invest 1.8 billion yuan ($286.77m) in the joint venture. SAIC, via its Hong Kong investment company and UK-based subsidiary, will control 51 percent of the JV, while partner Charoen Pokphand will own 49 percent. SAIC will grant technology and logo permits, allowing the JV to manufacture and sell its MG Roewe models in Thailand and neighboring markets.
According to SAIC CEO Hu Maoyuan, the first step for the new JV is to release a range of vehicles in 2014. Its initial annual production and sales volumes are expected to reach 50,000 units. The JV will then make use of duty-free policies in the ASEAN market to export automobiles to neighboring countries. The JV will strive to ultimately attain an annual production capacity of 200,000 vehicles, Mr. Hu said.
China Passenger Car Association Deputy Secretary Cui Dongshu has previously commented that Thailand is an important automobile production center, and that being able to manufacture vehicles there is extremely beneficial for succeeding in Southeast Asia. Toyota and Honda are among the major multinational manufacturers that possess automobile production sites in the country.
SAIC has exported a total of 81,000 vehicles from January to October, 6,000 of which were own brand passenger automobiles. If the Thai JV is successful, that number should grow substantially.
