German luxury carmaker BMW is preparing to outsource Mini production in China to Chinese Great Wall Motor, Bloomberg said 10:52 citing people familiar with the matter. Great Wall of China is the largest SUV producer in China.
The two companies are discussing the possibility of exporting MINI cars from China to other markets, and the source spoke on condition of anonymity because of the confidentiality of the talks. Great Wall Motor's spokesman declined to comment, saying the company would issue a formal statement later. The head of BMW in China did not immediately respond to an email seeking comment on the matter.
Great Wall Motor was suspended from trading on the Hong Kong Stock Exchange today, and Great Wall Motor's share price rose 14% yesterday under the influence of rumors of a joint venture between the two companies.
In addition, BMW is seeking a joint venture with Great Wall Motor in China to focus on producing electric cars, Reuters said on Wednesday, citing two people familiar with the matter.
"We are discussing with Great Wall Motor to set up a joint venture to produce cars in Changshu," said one BMW executive, who spoke on condition of anonymity. "but I don't know how far the joint venture has gone or whether the two companies have been approved by the government to set up a joint venture. "
Another person familiar with the matter said the new joint venture between Great Wall and BMW in Changshu would not produce gasoline or diesel-powered cars. This suggests that the focus may be on electric cars.
In the Chinese market, BMW Group sold more than 500000 vehicles in 2016 for the first time, with a total sales of 516300 vehicles (including MINI), up 11.3% from last year (463800), making it the second largest luxury brand after Audi.
BMW is trying to stay in second place, ahead of Mercedes-Benz in third place. Mercedes-Benz's sales in China increased by 26.6% in 2016.
Recently, foreign automakers have announced a series of investments and cooperation in China. Tesla, Inc., Ford, Daimler and GM have all announced that they will build electric vehicles in China.