Dongfeng establishes production JV with Taiwan's Yulon
Dongfeng Motor Corp. will set up an auto production joint venture with Taiwanese automaker Yulon Motor Co. in China later this year to accelerate its expansion into the domestic passenger vehicle sector.
China's central government approved the proposal on July 29, said the state-owned Dongfeng said in a statement.
Under the plan, Dongfeng will establish a 50-50 joint venture with Yulon in Xiaoshan of east China's Zhejiang province before the end of the year.
With registered capital of 1.6 billion yuan ($236 million), the new venture initially will build up to 120,000 passenger vehicles and 120,000 engines a year.
The joint venture will build sedans, SUVs, MPVs and electric vehicles, Dongfeng added in the statement.
The new venture will launch production of its first product in mid-2011, says Dongfeng, without specifying what kind of model it will be.
The joint venture will sell vehicles under its own brand, known as Nazhijie. The English name of the brand has yet to be disclosed. Dongfeng and Yulon will jointly own the brand.
Established in 1953, Yulon builds its own Tobe and Luxgen branded cars in Taiwan. It also has a joint venture assembly plant with Nissan Motor Co. in Taiwan.
Dongfeng, a leading commercial vehicle maker in China, ventured into the domestic passenger vehicle market two years ago with the creation of its own car brand, Aeolus.
To date, Dongfeng has launched two passenger cars: the three-box Aeolus S30 sedan and its hatchback version, the Aeolus H30.
