Beijing Auto confirms buying Fujian-Daimler JV

Shanghai, July 24 (Gasgoo.com) Beijing Automotive Industry Holding Corp (BAIC) has confirmed its plans to buy 50% stake in Fujian Daimler Automotive Co., Ltd., a commercial vehicle joint venture between southeast China's Fujian Motor Group and German's Daimler Ag, Beijing Times reported today.

According to sources, Beijing Auto is looking to replace Fujian Motor as Daimler's Chinese partner in the CV manufacturing venture by taking over Fujian's 50% stake in Fujian Daimler Automotive. The other stakeholders in this JV are Daimler (34%) and Taiwan's China Motor (16%). Beijing Auto will restructure the venture as part of its expansion strategy.

Beijing Auto had aimed to acquire Fujian Motor Group, especially its most important company Southeast Motor, but failed to reach agreement with Fujian provincial government for some reason. However, in its talks with Fujian about buying the Daimler venture's stake, Beijing Auto has got approval from both Fujian authorities and the German automaker.

The Fujian-Daimler facility, which was established in June 2007 in Fuzhou, provincial capital of Fujian, has been planned with annual output capacity of 40,000 vehicles. Output of Vito and Viano models is scheduled to commence later this year, while the Mercedes-Benz Sprinter model will enter production at the plant in 2010.

A PR manager of Fujian-Daimler has also confirmed that the venture would have some change in its shareholders but this would not affect its production plans. A top executive of Beijing Auto told reporters yesterday that the company's acquiring of Fujian-Daimler will be realized soon.

Daimler Ag, whose Mercedes-Benz unit has a joint venture with Beijing Auto, also reached an agreement with Beiqi Foton Motor, a subsidiary of Beijing Auto, earlier this year to build heavy-duty trucks.