Subaru may form Chinese venture with FAW Toyota

Shanghai, June 29 (Gasgoo.com) Subaru has contacted Jiangling Motors Company (JMC) in Nanchang, and both sides may cooperate to produce main components in China. In terms of setting up a joint venture to produce cars in China, Subaru may cooperate with FAW Toyota, media reported.

An industry expert said that there is basis for Subaru and JMC to cooperate with each other. In addition to the fact that both sides have products in the SUV market , such as Subaru's SUV products Outback (Aohu), Tribeca (Chipeng), Forester (Senlinren) and JMC's SUV products Landwind X6 (Lufeng), Landwind X9 and Fashion (Fengshang), JMC also has the technical background from Isuzu Motors.

If producing auto parts in China is the premise for Subaru to produce cars, then who will be its partner is going to be a hot issue in the industry.

"In order to minimize the risks, Subaru may choose to depend on Toyota to develop in China, therefore, join with FAW Toyota or Guangqi Toyota will be its choices,"said Jia Xinguang, a renowned analyst in the auto industry.

Guangqi Toyota denied the possibility by telling the media that they never talked with Subaru about this. An insider from Subaru confirmed that Subaru and FAW Toyota had a discussion about its production in China and, apart from setting up a joint venture, they also reached a preliminary agreement on introducing a best selling model for China production in the early phase.