Changhe Auto not to be acquired by auto giants

Shanghai, May 5 (Gasgoo.com) The widespread rumor that Jiangxi Changhe Automobile Co. would be acquired by China's automaking giants such as Beijing Auto or Changan Auto was spiked by Changhe Auto's general manager Zhou Shining in a recent interview with The Beijing News. Instead, the company will become part of the New Aviation Industry Corporation of China, Zhou said.

China Aviation Industry Corporation I (AVIC I) and China Aviation Industry Corporation II (AVIC II) will be merged to be the New Aviation Industry Corporation of China this year. As a subsidiary of AVIC II, Changhe Auto will have larger scope for development and growth in the new aviation complex, because the aviation giant will put auto manufacturing high on the agenda of its future expansion. Changhe Auto's joint venture with Dongfeng Motor and Hafei Auto will also be handed over to the new aviation corporation.

Changhe Auto, based in Jingdezhen city, Jiangxi province, has received huge investment from AVIC II for automobile R&D and energy efficiency projects. In the coming two years, the carmaker will launch two new car models -- one is own brand, and the other is joint venture product. The company will pursue the double-brand strategy in its future growth: its new auto products will carry the Changhe brand and the Changhe Suzuki brand.

In 2007 Changhe Auto and one of its associates distributed 107,699 automobiles and produced 49,955 engines, obtaining approximately 66% of its total revenue from the sales of its vehicles.