China Aviation Industry Group to form auto corp

Shanghai, January 19., 2009: (Gasgoo.com) After restructuring the assets of its subsidiary Changhe Auto, China Aviation Industry Group Corporation (AVIC) has started integrating its auto-making operations to form an automobile industry corporation, Shanghai Securities news reported today, citing a top executive of the group.

Tan Ruisong, executive vice-president of AVIC, said to the business newspaper yesterday that the group has set up a work team in charge of integrating its auto branches. At its early stage, the new auto industry corporation of AVIC will consist of Hafei Auto, Changhe Auto, Dongan Power and some other companies.

Meanwhile, AVIC¡¯s auto corporation will also consider introducing strategic investors to expand its auto-making business, which AVIC will continue to develop along with its aircraft-making bsuiness. Some domestic automakers have attempted to buy out AVIC auto divisions, but failed.

In late 2008, Changhe Auto was merged into the new-born AVIC (derived from former AVIC I and AVIC II), a move that is seen as the first step by the Chinese aviation industry giant to integrate its auto-making divisions.

AviChina Industry & Technology Co., Ltd., which is controlled by AVIC, will transfer all its auto operations, including Dongan Power, to the emerging auto corporation and focus on aviation industry.

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