Dongfeng's acquisition of Hafei remains uncertain

Harbin Hafei Automobile is controlled by aircraft maker AVIC II, which has reportedly planned to exit the automobile business to focus on its core business.

Dongfeng Motor is the parent company of Dongfeng Motor Group, the Chinese partner of French company PSA Peugeot Citroen.

Dongfeng, which also has joint venture partnerships with Nissan Motor and Honda Motor, plans to strengthen its position in the Chinese automobile market with the acquisition of Harbin Hafei Autombile.

"The merger creates a lot of uncertainties for the Hafei deal. I have no idea whether the management of the new company still wants to gradually pull out of the auto sector as previously planned. It is hard to say at the moment which way the Dongfeng-Hafei deal will be heading in the end," the source said.