Stellantis Plans To Take Majority Share In JV With GAC In China
Stellantis N.V. announced the plan to increase its shareholding in GAC-Stellantis from 50% to 75%. The announcement is a key element of Stellantis’ plan to set a new basis for its business in China. GAC Group and Stellantis have agreed to collaboratively complete the relevant formalities of the deal, which remains subject to the approval of the Chinese government.
GAC-Stellantis is a joint venture formed between China Guangzhou Automobile Group Co., Ltd. (GAC Group) and Stellantis in March 2010.
In September 2021, Stellantis announced that it would create a simplified operating organization “Stellantis Jeep” to develop the brand in China. The JV is now fit to support the efficiency of this integrated “One Jeep” strategy in China, focused on the Changsha manufacturing plant, which is currently preparing to launch the Compass model. GAC Group and Stellantis will continue collaborating closely with each other to grow the brand’s profitable business in China.
In 2021, Stellantis strengthened its business position in China laying a solid foundation for the Company’s long-term expansion.
“Since day one of Stellantis, we analyzed the situation together with our partners and we are now finalizing our plans for China, which we consider as a strategic market in terms of untapped potential,” said Grégoire Olivier, Chief Operating Officer – China, Stellantis.
Dongfeng Peugeot Citroën Automobile Co., Ltd (DPCA), the joint venture formed by Stellantis and China Dongfeng Motor Corporation, sold over 100,000 vehicles in 2021, more than doubling the annual sales volume of 2020. This business performance made 2021 the turnaround year for DPCA. Of the more than 100,000 vehicles, around 9,300 New Energy Vehicles (NEV) were sold, which has made DPCA a net contributor of NEV and CAFC (Corporate Average Fuel Consumption) credits of Stellantis in China. The turnaround allowed significant improvement of DPCA’s financial situation, setting the stage for the new DPCA strategy.
For the Jeep® brand, the iconic Wrangler had record sales in 2021. In addition, the Jeep product lineup was recognized as No. 1 in APEAL and Vehicle Dependability (VDS) and No.2 in Initial Quality (IQS) by JD Power’s study among mainstream brands in China.
In the area of independent aftermarket, after an initial investment in the independent spare parts distributors of Shanghai JianXin and Shandong United Auto Parts (UAP) in 2018, and then Fujian Longstar in 2019, Stellantis has now taken control of UAP, merging the three entities into one integrated national distributor, and creating the fourth largest spare parts distributor in terms of sales turnover in the independent aftermarket business in China. With a 53.5% stake in the newly integrated spare parts distributor, Stellantis has significant growth potential ahead. In 2021, this business had a sales turnover of €176 million in the independent aftermarket in China.
Additional details on Stellantis’ plan for the Chinese market will be announced within the global strategic plan on March 1, 2022.
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