Chinese companies speed up takeovers in world's car business

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Chinese companies accelerated their takeover efforts in the overseas auto industry in the first half of 2017, aiming for a bigger role in international auto markets, Wall Street Journal reported on Tuesday.

Fox Business also pointed out that for several years, China-based businesses have been investing money into numerous automotive operations including glass and tire makers to technology developers and car makers, reflecting Beijing’s goal of becoming a leader in the world’s car business.

According to Michael Dunne, president of advisory firm Dunne Automotive, this phenomena reflects two facts: One is that Chinese automotive companies have clear investment targets in mind unlike other sectors such as entertainment; another is that the automotive sector has received largest government support to confidently compete in global market.

Chinese companies made eight overseas deals totaling more than 5.5 billion US dollars in the first half of this year, compared with nine investments for all of last year, said the report.

Cars have‍ a final test in Guangzhou Huadu Auto Industry Base on July 15, 2017. /VCG Photo

Tencent Holdings, one of China's most famous Internet companies, spent 1.78 billion dollars on a 5-percent stake in Tesla in March, a move targeting the lucrative self-driving vehicles and related services.

Last month, Ningbo Joyson Electronic Corp. announced a 1.59-billion-dollar takeover of the bankrupt Japanese air-bag maker Takata. If finalized, the purchase will be Ningbo Joyson's fourth overseas takeover in two years.

China's investments in the overseas auto industry have totaled more than 34 billion US dollars since 2008, according to the report. In the United States, Chinese companies now are hiring thousands of workers and manufacturing products from auto glasses to luxury cars.

(L-R) Belgian Vice Prime Minister and Foreign Minister Didier Reynders, Chinese carmaker Geely CEO Li Shufu and Belgian Prime Minister Charles Michel attend a meeting in Brussels on June 2, 2017. /VCG Photo

In 2015, Zhejiang Geely Holding Group Co. announced an investment of 500 million US dollars to build a Volvo plant that would employ 2,000 people in Ridgeville, South Carolina.

Fuyao Glass Industry Group Co. also spent 1 billion US dollars on the US manufacturing facilities, including reopening a former General Motors Co. plant in Moraine, Ohio, which will employ 2,500 people.

(With inputs from Xinhua)