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Daimler and Beijing Automotive Group will invest EUR1 billion ($1.37 billion) to more than double Mercedes-Benz production capacity at their joint-venture site to keep up with increasing demand. The Beijing site produces the C-class, E-class sedans, GLK SUV and will add output of the GLA compact SUV next year. The expansion will allow the site to build over 200,000 vehicles in 2015.
The site could be further expanded if demand continues to surge. Mercedes posted a 57-percent rise in deliveries in China in the first two months of the year. The EUR1-billion investment is part of a EUR4 billion spending project in China that will also include broadening of the carmaker’s model lineup. Daimler and BAIC will also hike engine production at their Beijing site from 250,000 units as vehicle sales rise.
Daimler chief executive Dieter Zetsche said in a statement that the Chinese auto market continues to have great potential, in which the company wants to participate in. China is vital to Zetsche's goal for Mercedes to top BMW and Audi and become the best-selling luxury car brand in the world by 2020.Read the entire article Daimler and BAIC to spend 1 billion euros to raise China output
BAIC Motor is planning to raise up to $2 billion in an initial public offering in Hong Kong, higher than its initial target of nearly $1 billion last year. The listing is expected to take place in the second quarter of 2014, sources privy with the IPO plans told Reuters. According to industry executives and analysts, an expected series of economic stimulus measures and strong demand for cars in smaller Chinese cities in interior regions will boost the industry’s performance in China.
"China's auto industry is in the midst of a recovery, and is likely to grow 8 to 10 percent a year over the next few years," Liang Yonghuo, an analyst at Haitong International Research Ltd., told Reuters. Daimler holds a 12-percent stake in BAIC Motor following a EUR640-million agreement inked in November 2013.
The stake acquisition was designed to boost Daimler’s presence in China and secure a foothold before the BAIC Motors’ IPO. The listing could help finance the goal of BAIC Motors’ parent -- Beijing Automotive Group -- to join the ranks of SAIC Motor, Dongfeng Group and FAW Group as the Chinese government tries to consolidate the auto industry and create globally competitive companies.Read the entire article BAIC Motor eyes to raise $2 billion from Hong Kong IPO
Chinese state-owned automaker BAIC Motor may be allowed by its foreign-based partner Mercedes-Benz to use the German automakers’ architectures in building its premium vehicles, according to parent company Daimler. Mercedes has fallen behind bigger rivals BMW and Audi in China. Mercedes intends to narrow this gap by purchasing a 12% stake in its local joint venture partner for 640 million euros ($822.3 million).
Last Thursday, Finance Chief Bodo Uebber said that the value of its stake will continue to increase every time that it gives support to BAIC. However, he clarified that there’s no final decision yet on whether BAIC can use components and platforms in the future. He also said that the company still has to determine which parts BAIC can use.
It would be a very unexpected move for BAIC to be permitted to use Mercedes-Benz’s entire vehicle platforms. This is actually a very tough decision. BAIC intends to join listed competitors Dongfeng Motor and Geely via its debut on the Hong Kong stock market, most probably in 2014, as soon as Daimler's deal to buy a stake has closed.Read the entire article BAIC might be allowed by Mercedes-Benz to use its vehicle platforms
As part of Daimler’s bid to rise above its weakness in China (the world’s biggest auto market), it may make an investment in the passenger-car unit of its Chinese partner, BAIC Group, according to sources. Last Friday, a source said that when BAIC Motor is floated, Daimler may take a stake of 10 to 20%. It was also reported that the size of the stake depended on talks with its Chinese partner.
Last September, Xu Heyi, the chairman of state-controlled BAIC, informed Reuters that it hopes to list its passenger-car subsidiary, BAIC Motor, in 2013. The company is hoping to raise about 10 billion yuan ($1.6 billion). More sources said that BAIC Motor will be listed in Hong Kong in 2013, hitting a volume of at least $1 billion, while other sources warned that an initial public offering (IPO) may be put off until 2014.
They also claimed that the listing will be organized by Goldman Sachs and Morgan Stanley. It’s possible that a BAIC investment will help Daimler to get its struggling China business to recover. Daimler subsidiary Mercedes-Benz considers China to be its No. 3 market globally after Germany and the U.S., it still falls behind BMW and Audi in the country. Mercedes’ sluggish sales in China have caused it to fall to third place in the worldwide ranking. BMW is No. 1 while Audi is No. 2.Read the entire article Daimler interested to buy a stake in the passenger-car unit of BAIC Group
The joint venture of Beijing Automobile Industry Holding Co. and Daimler AG is seeking 12.8 billion yuan ($2 billion) in loans from a group of banks for an engine factory and new production lines.
Chairman Xu Heyi of Beijing Auto confirmed this in an interview in the Chinese port city of Dalian, where he attended the World Economic Forum meetings. In June, Beijing Auto and Daimler inked a deal to invest 2 billion euros to manufacture four new models in China, construct a new R&D center and expand engine production.
The joint venture, called the Beijing Benz Automotive Co., currently produces around 80,000 C-class and "stretch" E-class sedans in China annually, says Autonews. Daimler revealed that it will boost production, but it did not disclose how much capacity it plans to add.Read the entire article Daimler, BAIC seeking $2 billion in loans for new production lines and an engine factory
An agreement was signed by Daimler AG and Beijing Automotive Industry Corp. to invest 2 billion euros for the production of four new models in China, the expansion of its engine production, and construction of a new r&d center.
Daimler CEO Dieter Zetsche said through a written statement that this investment will enable Mercedes to expand its compact luxury car lineup.
Zetsche said that as early as 2020, sales in China will reach a proportion of at least one in five premium compact cars. Due to this potential, the company is “switching to attack mode” by locally producing its new compacts.Read the entire article Daimler, BAIC to invest 2 billion euros for the production of four new models
The tooling and design rights to the outgoing Saab 9-5 are likely to be bought by the Beijing Automotive Industry Corporation (BAIC), according to our sources.
Recently, BAIC became a minority shareholder in the Koenigsegg Group, which is seeking to buy Saab from General Motors. If BAIC's plans go ahead, production of the 9-5 will be moved to China.
Incidentally, production of the 9-5 estate is expected to end in the next few weeks. Questions are circulating on whether BAIC will re-start production of the 9-5 in its current form or whether it will re-skin the car for sale under BAIC's own brand.Read the entire article BAIC to buy the design rights of outgoing Saab 9-5
More than ever, it has become obvious that China's automakers have a difficult road ahead of them to gain a global profile. General Motors still has not been able to sell Saab off to other parties and it doesn't appear likely that Beijing Automotive Industry Holding Corp., which has shown interest in the brand, will be successful.
China's automakers already dominate their home market but like BAIC, they want to quickly get to the global market. One of the fastest ways would be to snap up assets from troubled Western carmakers such as GM but it appears that it's not the easiest path to take.
Generally, the Chinese produce low-end cars for its domestic market and they don't have the technology and management and marketing expertise to handle global brands.Read the entire article BAIC shows its interest in Saab
Even as a deal for a consortium that includes Beijing Automotive Industry Holding Corp (BAIC) to purchase Saab has collapsed, BAIC still was able to buy Saab's production equipment for its old 9-5 models, according to a report from Sweden's Ny Teknik newspaper. Reportedly, Saab had started to dismantle the production line for the old 9-5 in October.
Saab plans to send the equipment to China and make preparations for its new 9-5 line, which will start production early next year.
General Motors Co., Saab's parent company, had previously hesitated to sell anything that holds intellectual property rights but it probably made the exception because the 9-5 production equipment is significantly different from any other car it makes.Read the entire article Saab sells production equipment for its old 9-5 models to BAIC
Saab defends its plan to sell key assets to Beijing Automotive Industry Holdings Co. by saying that this will help in securing its future.
No details were revealed about the deal but Saab spokeswoman Gunilla Gustavs did say that the money taken from the deal will finance the new Saab and "contribute to a good start under new ownership."
Gustavs asserted that Saab and its parent, General Motors Co., are actively searching for a buyer for the Swedish automaker. She said that the company is confident that a deal will be entered.Read the entire article GM sells key Saab assets to BAIC in order to get some cash
Beijing Automotive Industry Holding Co., which plans to immediately utilize the technology that it recently acquired from General Motors Co.'s Saab unit, revealed that production of these cars will begin as early as 2011. BAIC, China's fifth-largest automaker, acquired the rights to vehicle platforms from Saab for an undisclosed amount.
There are unconfirmed reports that BAIC paid $197 million for the assets, which include the intellectual property and tooling for the current-generation Saab 9-5 and some IP from the 9-3.
The purchase, which was put together in just two weeks, comes after negotiations for Koenigsegg Group AB to buy the entire Saab had broken down.Read the entire article BAIC wants to integrate immediately newly acquired Saab designs
The Beijing Automotive Industry Holding Corporation, which now wants to partner with Saab, had actually been involved in a failed attempt to purchase Saab from General Motors.
BAIC CEO Wang Dazong said that the Chinese automaker has a "durable interest" in expanding the partnership with Saab. Wang also said that BAIC is prepared to invest in Saab.
It can be recalled that last year, BAIC submitted a bid for Saab but it was ultimately rejected. GM picked Koenigsegg later on but the transaction fell short. It was Spyker Cars N.V. that was eventually able to negotiate a deal for the brand, paying nearly $400 million last February.Read the entire article BAIC wants to invest in Saab
Chinese manufacturer BAIC is facing protests made by Opel unions for having lodged a GBP570 million bid for Opel/Vauxhall. Union leaders expressed doubts on whether BAIC is sincere in its promise to keep European factories open. They further claim that BAIC is not interested to see the carmaker survive in the long run.
Opel's top union official, Klaus Franz, said that BAIC is interested only in gaining Opel/Vauxhall technology to use on cars for the Chinese market. He further cited BAIC's lack of experience in the global auto industry.
Rainer Einenkel, union leader at Opel's Bochum factory in Germany, said, "I have a lot of concerns and skepticism about BAIC because I cannot assess its intentions."Read the entire article BAIC not wanted by Opel unions
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