Two leading automakers in China and the United States yesterday announced a multibillion-yuan deal to manufacture commercial vehicles.
FAW Group Corp and US-based General Motors (GM) have teamed up to establish FAW-GM Light Duty Commercial Vehicle Co Ltd.
The 50-50 venture is the first between the leading automakers and the first major international investment by GM since it restructured as New GM after filing for bankruptcy protection in the US two months ago.
The joint commercial vehicle firm is based at FAW's headquarters in Changchun, capital of Northeast China's Jilin province, and has registered capital of 1.2 billion yuan ($176 million) and total investment of 2 billion yuan.
The company is focused on the production and sales of light-duty trucks and vans, as well as research and development, exports and after-sales support.
Production began yesterday as the venture includes facilities FAW uses for Harbin Light Vehicle Co Ltd and Hongta Yunnan Automotive Manufacturing Co Ltd, said Nick Reilly, GM's executive vice president and president of GM International Operations.
Manufactured in Harbin, Heilongjiang province, and Qujing, Yunnan province, existing and future products will be branded FAW Jiefang in China, leaving room for the creation of GM derivatives in the near future.
Capacity will reach 200,000 units per year, said Kevin Wale, president and managing director of GM China.