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MINI to build cars in China with Great Wall
13 October 2017, 05:30 | Kelvin Horton
BMW to outsource China mini car making to Great Wall
Patrick Yuan, an analyst at Jefferies Hong Kong, said it is understandable that BMW needs a new partner to defend its market share in a more competitive market.
Another person familiar with the matter said the new joint venture in the eastern city of Changshu would not deal with gasoline or diesel powered cars, indicating a focus on electric vehicles was likely.
While BMW already builds cars locally in a venture with Brilliance China Automotive Holdings Ltd, Great Wall doesn't have any carmaking partners in China.
Great Wall Motor said on Friday that it hasn't signed an agreement with BMW, but said that the two companies signed a confidential agreement in February to discuss cooperation in the production of Minis. That strategy helped propel the company to a 26 percent sales surge a year ago. BMW is trying to stay ahead of third-place Daimler's Mercedes-Benz, which recorded 26.6 percent growth in China sales in 2016 thanks to a fresher model lineup.
The Mini small auto, first built to tackle soaring fuel prices in the late 1950s, has evolved over the years and the vehicles are now produced in the United Kingdom and the Netherlands.
Reuters earlier this week reported the two automakers were looking to establish a joint venture in China. Talks with BMW are still at a preliminary stage and it is uncertain whether the cooperation will commence, the Chinese vehicle maker said.
A Great Wall official declined to comment.
BMW AG is working on a deal that will bring manufacturing of the iconic Mini brand to China for the first time, according to people with knowledge of the plan.
Trading would be suspended pending clarification of press articles, the company said.
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