FAW's car unit dumps MPV project amid losses
FAW Car Co., the car unit of China FAW Group Corp., scrapped its multipurpose vehicle development project to avoid incurring more losses.
The project, code-named D021, already has cost the company 209 million yuan ($30 million).
The project required an investment of 1 billion yuan and the company said it would have had difficulty spending that much after swinging to a loss in 2016.
In 2016, FAW Car's sales slumped 18 percent year on year to 193,500 vehicles. Due to the plunge in deliveries, the company lost 954 million yuan last year after earning 53 million yuan in 2015.
FAW Car, which is headquartered in the northeast China city of Changchun, builds Besturn-badged sedans and crossovers as well as the Oley-brand hatchback.
The automaker also produces the Mazda3 Axela and Mazda6 sedans, the Mazda8 multi-purpose vehicle, and the CX-4 and CX-7 crossovers under a licensing agreement with Mazda Motor Corp.
Its parent, China FAW Group, is a major Chinese truck maker. That company also operates joint ventures with Volkswagen Group and Toyota Motor Corp.
The project required an investment of 1 billion yuan and the company said it would have had difficulty spending that much after swinging to a loss in 2016.
In 2016, FAW Car's sales slumped 18 percent year on year to 193,500 vehicles. Due to the plunge in deliveries, the company lost 954 million yuan last year after earning 53 million yuan in 2015.
FAW Car, which is headquartered in the northeast China city of Changchun, builds Besturn-badged sedans and crossovers as well as the Oley-brand hatchback.
The automaker also produces the Mazda3 Axela and Mazda6 sedans, the Mazda8 multi-purpose vehicle, and the CX-4 and CX-7 crossovers under a licensing agreement with Mazda Motor Corp.
Its parent, China FAW Group, is a major Chinese truck maker. That company also operates joint ventures with Volkswagen Group and Toyota Motor Corp.
