The VW Group is looking into acquiring a big stake into its Chinese partner JAC Motors, and has hired Goldman Sachs to advise them on how to move forward.
The report comes from Reuters, citing people with direct knowledge on the matter. Since the Chinese government decided to allow foreign car makers to gain control of their joint ventures or any local manufacturer last year, many companies have started to take advantage of the new regime.
The VW Group, currently the biggest foreign car maker in China, is exploring the possibility of buying a significant stake in the mostly state-controlled JAC Motors, as opposed to their joint venture – but the plan is still at an early stage.
“We are carefully watching what the implications are for our business and for our joint venture partners,” VW said to Reuters. “In this regard we will explore all possible options together with all stakeholders to secure long-term success in China.”
VW has been operating in China for decades, delivering a total of 4.21 million cars in mainland China and Hong Kong last year. The German carmaker has established three joint ventures in the world’s largest car market, including JAC Motors, FAW Group and SAIC Motor.
The company’s joint venture with JAC Motors was first established in 2017 with the goal of developing electric passenger vehicles. If their plan goes through and VW does gain control of JAC, the German car maker might shift a large portion of its EV production in China, according to one of the sources.
BMW has already agreed to gain the control of its main joint venture in China with Brilliance, while Daimler is also in talks over increasing its stake in its Chinese partner BAIC Motors.
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