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Japanese automaker Mitsubishi Motors Corp. (MMC) said Tuesday it planned to buy a 50 percent stake in Southeast Fujian Motor Corp. to boost its production and sales on the Chinese mainland.
MMC said it had signed a memorandum of understanding (MOU) with China Motor Corp., a major shareholder of Southeast Fujian Motor, and would begin discussing purchase details.
"The MOU with China Motor opens the way for MMC to further boost its operations on the Chinese mainland," MCC said.
China Motor said in September it planned to sell 15 percent of its stake in Southeast Fujian Motor to MMC, which holds 14 percent of China Motor and has been providing technical support for the two Chinese companies.
MMC was planning to both restructure its operations and boost sales in China by using Southeast Fujian Motor as a major base for its products, the Japanese company said.
Southeast Fujian Motor is the second-largest manufacturer of vans on the Chinese mainland and also builds the Lioncel, Freeca and other cars based on MMC models.
MMC, Japan's only loss-making automaker, has taken the Chinese market as its main hope for survival as its sales plunge in the Japanese and U.S. markets.
It has only one joint venture on the Chinese mainland, which was established with Hunan Changfeng Motor Co. and builds the Pajero sport utility vehicles.
Earlier this year, MCC forecast its sales volume in China would reach 225,000 units in its fiscal year ending March 31, 2005, but said later it was unlikely to reach the target.
(Shenzhen Daily December 29, 2004)
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