Fujian Motor denies rumors of acquisition by BAIC

Gasgoo.com (Shanghai March 6) - Fujian Motor Industry Group has denied recent allegations that it will be restructured by BAIC, Beijing Business Today reported today. "[We] have not heard any information regarding restructuring, nor do [we] believe that restructuring is necessary," staff from Fujian-owned Soueast Motor was quoted as saying. At a ceremony held to commemorate Fujian Daimler's name change, Fujian Motor Chairman Lian Xiaoqiang also remarked that he was unaware of any such information.

According to reports appearing over the years, BAIC and Fujian Motor have been holding discussions since 2008 regarding transfer of the Fujian Daimler joint venture. Some reports went as far as stating that the two parties had already signed an agreement that for whatever reason was not carried out. From that point out news of possible restructuring seemed to slowly vanish.

It was not until lately that more rumors that BAIC would purchase Fujian Motor began to appear again. Daimler AG, who has joint ventures with both BAIC and Fujian Motor, wants to see greater development on part of its JVs. To this end, Fujian Daimler recently changed its name to Fujian Benz, while the new venture between Beiqi Foton and Daimler gained official approval. With both JVs in the north and south making progress, rumors of increased cooperation between the two began to emerge.

BAIC sold a total of 1.54 million vehicles in 2011, and hopes to produce and sell 3.5 million vehicles by 2015. Acquisition of Fujian Motor, then, would seem to be a one method to achieving this lofty target. Whatever BAIC's mindset is, Fujian Motor seems content with things the way they are. "Fujian Motor's current development is extremely strong," one industry insider was quoted as saying, adding that without external pressure from Daimler BAIC-enforced restructuring is highly unlikely.