Two years of negotiations to become Zhengguo Chery fastest 2014 domestic Land Rover

After nearly two years of contact negotiations, Chery Automobile and Jaguar Land Rover have finally achieved positive results. Chery Automobile and Jaguar Land Rover officially announced yesterday that the two sides have reached an agreement to establish a joint venture company in China, and Chery and Jaguar Land Rover plan to establish a joint venture in the form of equity comparison. Among them, the international high-end car brand Land Rover is the fastest in China in 2014.

This is the first time that Chery has entered into a joint venture agreement with an international automotive company as an independent brand. Prior to this, Chery had been one of the few domestic independent brand companies that had not joint venture with foreign companies. Although there have been many contacts and negotiations with multinational brands, including many brands such as Fiat, Chrysler and Subaru, most of them have not come to an end.

According to the plan, the newly formed joint venture company will produce Jaguar Land Rover brand models and joint-venture models of its own brands, produce supporting engines, sell automotive products produced by joint venture companies, and establish R&D centers. In the announced agreement, the two parties did not disclose more joint venture details.

The reporter learned that the joint venture company's factory will be located in Changshu, Jiangsu Province. The factory is scheduled to be completed and put into production in July 2014. The company will first produce the Land Rover SUV, and the joint-venture brand will be based on the Jaguar platform to build the company’s own brand identity. The company’s R&D center and marketing center will be located in Shanghai. There are informed sources, the first phase of the joint venture's production capacity is expected to be 50,000 vehicles, the two sides have submitted a joint venture application to the regulatory authorities, is awaiting the results of the approval.

In fact, domestic related policies do not encourage large-displacement joint venture projects. Previously, private enterprises in Sichuan intended to acquire the Hummer brand without approval. However, for this joint venture between Chery and Jaguar Land Rover, industry analysts believe that as a Jaguar Land Rover, which mainly sells luxury large displacement vehicles, the joint venture with Chery, which produces mainly small displacements, will not only use its own brands. Advantages, but also to avoid policy risks, while localization has reduced the price of the models, which will be the result of a win-win situation.

A high-ranking Chery told reporters that Jaguar Land Rover saw Chery’s determination to go high-end, while Chery’s preference was Jaguar Land Rover’s brand advantage. At this stage, Chery hopes that the main purpose of the joint venture is to learn from Land Rover how to create high-end brands and product production management, in order to promote their own brand.

“As far as Jaguar Land Rover is concerned, China’s goal to become the world’s largest market for Land Rover is extremely urgent. For Chery, not only will the joint venture break through the bottleneck of transforming its own brand to the high end, but it will also make the joint venture a profitable dairy cow and eventually feed back into the future. With regard to independent brands, this is the key for both parties to be able to hit it off,” said Jia Xinguang, a veteran automotive analyst.

It is widely seen in the industry that establishing a joint venture between the two parties is a key step. Jia Xinguang said that regardless of national policy requirements or for their own considerations, Chery Land Rover’s joint-venture brand models will maintain a high localization rate, which is also the main reason why the two parties have not reached an agreement yet. In the future, Chery will adopt autonomy. Brands and other cooperation have shared more with Jaguar Land Rover in core technologies. Yin Tongyue, chairman and general manager of Chery Automobile, also stated that the goal of the joint venture is to give full play to the advantages of the two companies in terms of brand, R&D, manufacturing process and local market resources.

Although the joint venture between Chery and Jaguar Land Rover has not yet officially begun, Chery is already planning for a future management structure. Wu Jun, former general manager of SAIC-GM-Wuling Sales, has officially joined Chery, and is currently working on a joint venture between Chery and Land Rover which is under preparation. In the future, it will be mainly responsible for marketing and marketing. Another SAIC Motor passenger vehicle brand and communication department will be responsible for the future. Director Huang Huaqiong also joined Chery recently as a management position in corporate and strategic planning, and also served as a spokesperson for the press.