Industry analysts widely agree that one of the principal factors preventing Chinese automakers from succeeding outside of China is the local industry's fragmentation, with over 100 automakers vying for their slice of the proverbial pie. However, a merger announced Wednesday between two major Chinese automakers, Shanghai Automotive Industrial Corp (SAIC) and Nanjing Automotive Group, stands a stronger chance of succeeding in the international car market as a larger group.
The merger, which has been long anticipated, involves SAIC paying $285.7 million for Nanjing. In return, Nanjing's parent company acquires 4.9 percent of SAIC Motor Corp.
The products of SAIC's joint ventures with GM and Volkswagen Group account for 14% of the domestic market in China, selling 1.25 million vehicles in the first ten months of 2007. Nanjing, meanwhile, sold less than 80,000 over the same period, making the acquisition a merger in the same sense as Mercedes had "merged" with Chrysler. Nanjing, however, owns MG Rover, whose plants in England SAIC hopes to use as a foothold into the European market.
[Source: Automotive News – subscription required]
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Reader Comments (Page 1 of 1)
G Money @ Dec 26th 2007 6:22PM
Very confusing headline as SAIC is also the acronym for a top defense contractor "Science Applications International Corporation". Do trademarks hold any water internationally? SAIC is pretty big time in the consulting world, you would think they would have a problem with another company of the same name.
seoultrain @ Dec 26th 2007 7:10PM
when the IC stands for "international/industrial corporation," you're really only working with the first 2 letters. Should a company really have the rights to the letter 'S' followed by the letter 'A'?
seoultrain @ Dec 26th 2007 6:44PM
what a great graphic.
3seriesisking @ Dec 26th 2007 11:36PM
Agreed. Great job guys.
joe23521 @ Dec 27th 2007 10:06AM
The graphic is alright, but the caption made me laugh.
waiownsyou @ Dec 26th 2007 6:44PM
What's the point of giving that robot legs if there are 4 (or is it 8?) under each foot?
Will @ Dec 26th 2007 7:06PM
VOLTRON! (Or, Voltron's bitch cousin, Vehicle Team)
Still, very cool nonetheless.
Kotse @ Dec 26th 2007 8:46PM
SAIC goes to bed with Nanjing Auto (both PROC state owned)..Okey! Go figure...
Tagg @ Dec 26th 2007 11:51PM
I am surprised that the central government in Beijing doesn't become more involved in forcing more mergers.
Then again the central government doesn't own the companies but rather the provincial governments own the companies which contrary to popular belief there is a big difference between the two. SAIC is owned by the provincal government of Shanghai and has little input from Beijing, same for Nanjing so thats what makes it tougher because one province could lose out to the other but with Nanjing and Shanghai being fairly close it should be ok.
I guess what it comes down to is the fact that the the lobbiests (sp?) from the provinces are pretty strong right now, keeping the companies seperate. I am sure that will change in time.
joe23521 @ Dec 27th 2007 10:05AM
Shanghai and Nanjing are, in fact, cities, not provinces. But I kinda hear what you're saying.
Tagg @ Dec 27th 2007 3:02PM
You are right that Nanjing is a city but Shanghai is both a city and province. The province is pretty much the city with a couple very small towns just like Beijing is.
Hank @ Dec 27th 2007 12:15AM
i had that robot action figure toy when i was a kid!!! each part becomes its own vehicle/aircraft!! it was awesome lol
Random Task @ Dec 27th 2007 1:30AM
Auto Voltron was a pale shadow of Lion Voltron. Still, I give props for the graphic.
John R @ Dec 27th 2007 9:17AM
but really, who doesn't love vehicle voltron?
Prop_blu @ Dec 27th 2007 10:25AM
"...vehicle Teams...LAUNCH!"
XD.
Always laughed the "feet" being 4x4s--That were each as large as two train locomotives side by side. ..and how there were no connections or hinge joints, the rest of the parts just magically stacked on top and stayed.
dd @ Jan 15th 2008 8:52PM
http://www.dreamsatellite.com