7.24Chery, JAC merging to form Da-An Motors

Chery, JAC merging to form Da-An Motors

 

http://autonews.gasgoo.com/auto-news/1011441/Chery-JAC-merging-to-form-Da-An
-Motors.html

 

Shanghai, July 24 (Gasgoo.com) The Anhui provincial government is set to
merge Chery Automobile Co and Jianghuai Automobile Co (JAC) and turn them
into the so called "Da-An Motors" Group by end of this year, the Shanghai
Securities Journal reports on Thursday. 

 

Citing an informed source, the newspaper said the auto-industry team sent by
the Anhui provincial government, where Chery and Jianghuai is based, will
unveil detailed scheme on the merger deal before the end of year. The source
said the two sides may hold stakes in each other to form a full scale
alliance instead of a complete acquisition by any part. 

 

"If the merger happens, Chery and Jianghuai will operate independently for
at least five years before they begin to consider mutual product
development," the source said. 

 

Jianghuai's sales has slipped in 2008 due to a weakened demand in the MPV
sector, but the introduction of a small car lineup has helped to boost its
sales since the beginning of this year. Chery is renowned for making small
cars, and the automaker is planning to move into the premium and compact
segment with the launch of several new cars later this year. 

 

The two companies product line up does overlap, especially as Chery want to
promote MPV production, a sector where Jianghuai already keeps a strong
foothold. 

 

The Anhui provincial government has issued guidelines this May supporting
alliances and mergers among automakers within the province in response to
the government's call for creating competitive automobile giants.

 

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