Wally Edgar Chevrolet - SAIC/CHINA Raises 1.5 Billion To Support Building It's Own Auto Brand

Dec. 15, 2010 - PRLog -- SHANGHAI (Bloomberg) -- SAIC Motor Corp., the China partner of Volkswagen AG and GENERAL MOTORS Co., completed a private share placement that raised 10 billion yuan ($1.5 billion) to help it develop own-brand and new energy vehicles.
Shanghai Automotive Industry Corp., the company's parent, agreed to buy about 10 percent of the 720.98 million shares in the placement for about 1 billion yuan, SAIC said in a statement to the city's stock exchange on Wednesday.

While most of SAIC's vehicles are made with GM and VW, the automaker aims to sell 180,000 of its own-brand vehicles this year, President Chen Hong said in March.
SAIC owns the design rights to MG Rover's Rover 25 and Rover 75 cars, and renamed the Rover cars in China as Roewe after taking over the rights in 2005.

SAIC also plans to expand a technology center to compete against foreign rivals including Ford Motor Co. and Toyota Motor Corp. in China, which surpassed the United States in auto sales last year.
The Chinese government is encouraging domestic automakers to develop their own brands and alternative-energy technology.

SAIC may get access to GM's UK Network.

GENERAL MOTORS (GM), the largest overseas automaker in China, is considering giving long-time Chinese partner SAIC Motor Corp access to its sales network in the United Kingdom, a senior executive of the US firm said on Monday.
"We have agreed in a Memorandum of Understanding that we will discuss the potential for (British automaker) MG to be distributed in the UK," Kevin Wale, president and managing director for GM's China operations, said at the Reuters China Investment Summit.

However, Wale said no discussions have been held on sharing GM's dealer network in North America.
The GM-SAIC partnership has long been hailed as the most successful in the Chinese auto industry. The Detroit automaker sold more than 2 million vehicles in China, its largest market, in the first 11 months this year, exceeding its full-year target.

GM's Buick, CHEVROLET and Cadillac models, made at its flagship car venture with SAIC, also helped bolster the Chinese automaker's bottom line, making it a domestic champion.
The UK dealer network deal, if it is completed, would mark another milestone in their 13-year relationship and would make SAIC the only Chinese automaker to secure access to a partner's overseas dealer network.

The top Chinese automaker plans to start making MG series sedans in the UK by the end of this year and sell them across the European Union, its Chairman Hu Maoyuan told Reuters in January.
Access to GM's network there would be a big help for SAIC, which has little exposure to the European market so far, industry observers say.

SAIC had in November bought a nearly 1 percent stake in GM when the top Detroit automaker returned to the stock market with a more than $20 billion initial public offering.

SOURCE: Auto News China

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