FAW Car Co. plans to transfer Hongqi’s assets to its parent company

Shanghai(Gasgoo)-On Nov. 20, FAW Group released 16 notices successively, marking the opening for a new round of reform. FAW Car Co., Ltd. released a notice on asset transfer, saying that the company will transfer its assets of RMB 289 million, including parts of buildings, some related assets which were used to manufacture Hongqi's components and added-value taxes, to China FAW Group Corporation (hereinafter referred to as FAW). 

According to FAW Car Co., Ltd., the asset transfer will help the company to optimize asset structure, increase operating capital, support the development of the company's self-owned business, and improve the operating and managing efficiency.

The transaction is expected to help FAW Car Co., Ltd. to increase profit of RMB 100 million in 2017. After the transaction is completed, FAW will be capable of expanding depth of processing for Hongqi’s components and enhancing the quality of its products, furtherly strengthening the brand building for Hongqi.

Last year, FAW Car Co., Ltd. had transferred Hongqi's assets of RMB 420 million to its parent company, easing its tough situation greatly. Now, Hongqi's return to FAW Group is a determined move with definite goals and directions.

Xu Liuping, Board Director and Party Committee Secretary of FAW Group, showed his great confidence in the revival of Hongqi.  He also said that they would spare no effort to support and build Hongqi brand and vowed to make Hongqi to be China's first luxury vehicle brand.

At present, FAW divided its vehicle brand into three independent parts, namely the Besturn department, Jiefang Department and Hongqi Department, which is the only vehicle brand directly led by FAW. Concentrated on brand position, market perception, technology preparation and R&D for vehicle models, Hongqi can be rejuvenated with abundant changes such as reshaping brand image and improving R&D efficiency for products.