Auto

Great Wall confirms talks with BMW on Mini production in China


Bloomberg
October 13, 2017 12:11 CET

BEIJING — Great Wall Motor said it is in talks to cooperate with BMW over Mini brand cars, a deal if signed could bring production of the small car outside Europe for the first time.

The talks are in a preliminary stage, Great Wall said in a statement to the Hong Kong stock exchange on Friday. Bloomberg News reported the talks on Thursday.

The companies have not entered into any legal agreement to establish a joint venture in China, Great Wall said.

BMW said it would like to grow its Mini brand in China with the help of a Chinese partner. “It is only possible to accelerate growth of Mini in China with a local partner,” BMW said on Friday.

Moving some production of the iconic British car to China may help lower manufacturing costs for BMW, which is now in the midst of a costly push for electric vehicles as governments around the world seek to cut pollution caused by fossil fuels.

The deal could also deal a blow to the brand’s UK operations, already under threat because of Brexit.

For Great Wall, the deal would be an endorsement of its capabilities in the world’s biggest market.

Founded by billionaire Chairman Wei Jianjun, the Baoding, China-based company has become the nation’s leading SUV producer by offering consumers spacious models at prices cheaper than sedans from the likes of Volkswagen and General Motors.

Great Wall is now gunning for a slice of the premium SUV market, dominated by foreign brands such as Land Rover and Jeep.

BMW builds Minis in the UK and the Netherlands and is now preparing to add an electric version at its Oxford, England facility starting 2019 through 2023, with key components coming from sites in Germany. The relatively short time-frame would allow the company to shift production elsewhere with the car’s next revamp should tariffs surge when Britain quits the European Union.

In China, BMW already builds cars locally in a venture with Brilliance China Automotive Holdings. Sales of BMW and Mini cars in China rose 16 percent in the first eight months to 383,976 units. China’s passenger-vehicle sales rose 3.3 percent to 2.34 million units last month, data showed on Thursday.

Reuters contributed to this report

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