A source told Reuters that Ford Motor Co. seeks to increase its 30% stake in Jiangling Motors Corp. as part of an effort to hasten its expansion in China. Jiangling is a major light commercial vehicle maker in China.
This source further revealed that in a meeting with the governor of Jiangxi province a few days ago, Joe Hinrichs has shown an interest to increase Ford's stake in Jiangling.
Hinrichs, the president of Ford's Asia and Africa operations, has also assumed the role as chairman and chief executive of Ford's China operations in November.
Hinrichs and governor Wu Xinxiong's meeting on Dec 13 was confirmed by a provincial government official in Jiangxi, home base of Jiangling Motors. It is not clear if Ford and Jiangling Motors have reached a deal on raising Ford's stake.
So far, none of the parties have commented on these reports. Industry observers say that a higher stake in Jiangling, which accounts for almost a third of Ford's China sales, will give more voting power to Ford on Jiangling's board.
As a result, Ford will be able to make further inroads in China's fast-growing light commercial vehicle segment.
Company data show that in the first 11 months, Jiangling Motors' sales rose by 59.5% to 164,088 units. Jiangling Motors is currently operating two plants that build JMC and Ford's Transit models. They have a combined capacity of 210,000 units.