Changan Automobile denies rumor to buyout Suzuki stake in Changan Suzuki

Shanghai (Gasgoo)- Chongqing Changan Automobile Co., Ltd (Changan Automobile) officially announced on June 29 that the rumor saying the company is going to buyout the stake in Changan Suzuki held by the Japanese investor Suzuki was untrue and the Sino-Japanese joint venture will remain to serve consumers. 

The announcement was an official denial directed at a report released a few days ago which said that Changan Automobile plans to acquire Suzuki's stake in Changan Suzuki and the brand of Changan Suzuki will be preserved at the same time.

Founded in May, 1993, Changan Suzuki is held by three parties: 50% by Changan Automobile, 40% by Suzuki and 10% by Suzuki (China) Investment Co.,Ltd.

The Japanese automaker has been rumored several times before that it will retreat from its China's market. The relevant rumors might result from the joint venture's depressed sales and profit performances in recent years. According to the data from the China Passenger Car Association (CPCA), Changan Suzuki's annual vehicle sales in 2017 only reached 86,513 units, plunging 26% year on year. The company also suffered a profit loss up to RMB 84.82 million last year. For the first five months this year, the joint venture saw its cumulative sales slumping 47% over the previous year to around 21,000 units.

On June 15, Changhe Auto claimed that Suzuki had transferred its entire stake in Changhe Suzuki, the Japanese automaker's another joint venture in China, to Changhe Auto. The equity transfer had been approved by the government and the administrative registration of the joint venture's equity and name changing had been completed on May 30.