Chinese Beijing Auto is looking to buy a European brand

Dong Haiyang, president of Beijing Automotive Group’s new international arm, claims the company is looking at acquiring an established European car maker.

Reports say that investment banks acting for Beijing Auto have zeroed in on three medium-size companies with “good brand image”. Haiyang says Beijing Auto wants to use an established brand’s European facilities to expand production. The company is also keen to pick up a brand with good heritage within Europe, thus tapping in to established customer bases.

While not revealing any names, Haiyang did admit that two companies are currently being 'investigated' by his team of reseachers.

Beijing Auto has previously bought the old Saab 9-5 platform, the 2003 9-3 platform and Saab’s venerable slant-four engines. The C51X SUV, which is based on the 9-3, will go on sale next year.

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Comments
9

5 July 2013

PSA obviously

But then, who would buy a Chinese Citroen, the ultimate in barstardisation?

5 July 2013

brian245 wrote:

PSA obviously

But then, who would buy a Chinese Citroen, the ultimate in barstardisation?

GM are meant to be buying Peugeot so it won't be PSA that the Chinese are buying.

5 July 2013

**** off China and stop looking for shortcuts. Develop your own like Japan did and win customers through quality engineering and innovation.

Sums the nation up for me - tasteless, greedy and disrespectful.

I sincerely hope Europeans don't buy into any of the half-hearted junk they try and sell here in the future.

5 July 2013

Matty_Hall wrote:

**** off China and stop looking for shortcuts. Develop your own like Japan did and win customers through quality engineering and innovation.

Sums the nation up for me - tasteless, greedy and disrespectful.

I sincerely hope Europeans don't buy into any of the half-hearted junk they try and sell here in the future.

I have nothing against the growth of Chinese cars but you may have a point Matty. As you say the Jananese manufacturers, and now the Korean manufacturers have built a reputation through hard work. Simply taking over a European maker would potentially damage that brand for many years and reinforces the belief that China is always looking for quick wins and uses its size and wealth to get whatever it wants. Perhaps that's just business, but in business product image is key and this won't improve the image of Chinese cars. One Chinese company does seem to be doing things the right way imho - Great Wall. They've brought over the Steed pickup and are starting on the slow process of building their image and proving their vehicles are cheap, reliable and tough. Good luck to them.

5 July 2013

Will86, Geely bought Volvo and as far as I can tell it's brand image hasn't been adversly affected by that purchase.

It actually makes some business sense.  Yes you could spend billions slowly building and estavlishing your own brand, network of dealers and support infrastructure and start seeing a return on it all in 10 years, or you could purchase a medium European brand and have all of that immiedately.  It not only gives you instant market share, but a method by which to filter your chineese brand into the markets.

As long as the Chinesse back that purchase with funding, it could be a good move for a smaller european marque to compete with the likes of BMW, VAG, GM, Ford etc.

Is Autocar actually hinting that this company is eyeing up the remains of SAAB? In which case, my previous argument is null and void Smile

5 July 2013

China has the right idea.

 

5 July 2013

They have zeroed in on 3 companies and are investigating 2 of them. 

I assume PSA is one (or are they counting it as 2?). I cant think who the other(s) could be. Fiat is too big, and the Americans wouldnt let Chrysler go the Chinese. VW own almost everything else apart from Ford and Vauxhall/Opel. 

I cant see VW selling off a brand (Seat?) or Fiat selling Lancia. Renault are tied up with Nissan so surely too big.

Maybe they think GM would sell them the European arm?

I cant see any of it happening, but PSA must be the most likely to be a target for them. If it works like Volvo then it might be OK, if it works out as it did for SAAB and Rover then its bad news for everyone

6 July 2013

MattDoc, Volvo hasn't been harmed because Geely aren't, as of yet, bringing in Chinese made cars under the Volvo name. The brand still has a clear separate identity. The way I interpret the article above especially bits like this - 'Beijing Auto wants to use an established brand’s European facilities to expand production' - is that they want to start bringing in Chinese cars to Europe. Now if they keep the brands separate, it may work, though I can't see the buying public warming to them yet, but with comments like this - The company is also keen to pick up a brand with good heritage within Europe, thus tapping in to established customer bases' - I can't help but feel they are going to try sticking a European badge on what is a Chinese designed car. That would be damaging for both companies - it hasn't worked for MG yet, but at least with MG there wasn't another option.

6 July 2013

The fact that Geely seems to have got it right with their takeover of Volvo would seem to be the exception.  I've spoken to dealers who are trying to shift, for example, Great Wall vehicles and they say it's a hard struggle.  Admittedly, it's only pick-ups at the moment that are in the range, but it may put them off spending money on bringing cars up to European spec if they languish in dealerships and don't attract paying customers.

Volvo do seem to be doing well, but they are still recognisably the Volvo brand.  If Geely do fall into the trap of bringing in Chinese models disguised as Volvos, drivers may not be prepared to pay a premium price for something that's Volvo in name only.

Beijing Auto may just get it right, although there seem to be very few that would be up for sale if they'd enjoyed recent success, or would offer the volumes or profits necessary to justify what would be quite a considerable investment.

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