BMW partner Brilliance considers withdrawing from joint venture BBA
The joint venture between BMW and Brilliance China Automotive Holdings has been in existence since 2003 and is based in Shenyang. For many years, it was a 50:50 joint venture before BMW acquired a 75 per cent majority stake in BMW Brilliance Automotive (BBA) in 2022. According to Bloomberg, the parent company Brilliance China Automotive Holdings is currently looking for ways to raise fresh capital and is also considering selling the remaining 25 per cent of the joint venture.
The news agency refers to anonymous persons familiar with the matter. It also states that several Chinese car manufacturers are involved in preliminary talks about the sale of the shares, including FAW. As no final decision has yet been made, Bloomberg reports that BBA’s current shareholder structure could remain unchanged.
The current 75:25 ownership ratio came into force in February 2022. BBA had previously received the necessary business license from the Chinese authorities. The extension of the joint venture agreement until 2040 announced in 2018 under Harald Krüger thus became effective at the same time. BMW is said to have paid the equivalent of 3.6 billion euros for the 25 per cent stake in Brilliance last year.
“Today marks an important step, as we continue to expand our long and successful commitment to China,” said BMW CEO Oliver Zipse on the occasion of the share acquisition in February 2022. “We firmly believe that our continued success in the world’s largest automotive market can only go hand in hand with the growth and further development of our BBA joint venture. The joint venture contract has been extended until 2040 and lays the foundation for sustainable business success, creating growth and prosperity in the province of Liaoning and beyond.”
In the meantime, the plans for China have become more concrete. BMW also wants to manufacture its ‘New Class’ electric cars in China. After the market launch in 2025, the next-generation electric vehicle models will also be produced by BBA in Shenyang from 2026 – as will the batteries required for them.
In August, BMW also presented a special version of its 5 Series Sedan and the all-electric i5 for the Chinese market. Among other things, the China offshoots have a longer wheelbase, more space in the rear and specific design and equipment features. The 5 Series Sedan and the i5 for the Chinese market will be produced at BMW Brilliance Automotive’s Dadong plant in Shenyang.
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