Chinese state-owned automakers Dongfeng Motor and Chongqing Changan Automobile Company are in advanced talks to merge their operations, reported The New York Times, citing people familiar with the matter.
The discussions, involving detailed plans for combining the companies, have been communicated to their foreign partners.
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Dongfeng is valued at $4.89bn and Changan Automobile at $15.65bn, according to data compiled by London Stock Exchange Group (LSEG).
This development follows discussions from February, when the two companies were understood to be considering a merger to create a stronger entity.
This move aligns with China’s strategy to encourage state-owned automakers to become more self-reliant, particularly in the field of new energy vehicles.
Changan Automobile encompasses brands such as Chang-An, Deepal, Avatr, and joint ventures like ChangAn Ford, ChangAn Mazda, and JMC.
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By GlobalDataThe company recently held a European launch event, announcing its intention to enter at least ten regional markets in Europe by the end of the year.
It aims to sell three million vehicles this year, with a target of five million units annually by 2030.
Adding to its global expansion efforts, Changan Automobile announced in January a partnership with Kim Long Motor to build a new vehicle manufacturing plant in Hue, Vietnam.
The facility is set to produce Kim Long Changan Vietnam five to seven seater passenger vehicles.
Changan Automobile Group vice-president Wang Hui said: “This collaboration with Kim Long Motor Hue marks a crucial step in Changan Automobile’s globalisation strategy, and will serve as an important starting point for Changan Automobile’s entry into the Vietnamese market.
