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China Daily Website

Guizhou car JV in sight


GUIYANG (Xinhua) — The Guizhou Yunque (Lark) Car Corp recently agreed to form a joint venture with a Japanese company.

Owners of the corporation, the China Guizhou Aviation Industrial Corp and China Guizhou Joint Automotive Industrial Corp (CGJAIC), signed a letter of intent with Japanese Fuji Heavy Industries Ltd during a recent trade fair in this capital of Southwest China's Guizhou Province.

Under the agreement, the Chinese side will invest 306 million yuan ($36.87 million) in the new joint venture, taking 51 per cent of the stake. The Japanese side agreed to provide 294 million yuan ($35.42 million).

The new venture is set to manufacture 10,000 compact cars.

According to Yang Binyan, general manager of CGJAIC, even though the venture has already been identified by the Chinese Government as one of the country's eight major car production projects, the shortage of capital still restricts expansion.

"The new company will carry out technical renovation on existing production lines in a bid to produce and sell quality Yunque cars," he said.

The company will also attempt to reduce costs and hone its competitive edge in the marketplace, Yang said.

Compact cars are the best-selling models in China's auto market. Another major compact car model, the Alto, is produced by a joint venture between a local automaker and Japan's Isuzu Corporation.

At the same trade fair, Guizhou Province presented 23 tourism projects which need a total of $60 million in foreign investment.

The province plans to establish tourism companies, travel agencies, and hotels and sell its stocks on the Hong Kong Exchange.

Yang Shengming, Director of the Tourism Administration of Guizhou Province, says foreign investment will be used for building hotels, developing scenic spots and infrastucture.

Guizhou is rich in tourism resources, and is famous for its Huangguoshu Falls and diversity of ethnic groups.

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