Reuters reports that Honda has received approval from the Chinese government to set up the first Sino-foreign joint venture to make cars solely for export.
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
According to Reuters, Honda will own 65% of the venture, marking the first time China has allowed a foreign company to own a controlling stake in a car-making tie-up.
Guangzhou Auto Group will own 25 percent and Dongfeng Motor will own 10 percent, Reuters said, citing a Honda statement, and adding that the three companies will together put $US193 million into the project.
Reuters said that, as announced in July, Honda aims to build small cars with engine size of 1.0-1.5 litres, with plans initially to build 50,000 cars a year from the second half of 2004, to be exported to Asia and Europe.
Honda also has a 50-50 venture with Guangzhou Auto, which has been making Accord sedans and Odyssey minivans since 1998, Reuters noted.
