BEIJING, April 20 Olaf Kastner, Chief Executive
of BMW Brilliance Automotive, said the joint venture between BMW
Group and Brilliance China Automotive Holdings Ltd
had diversified beyond building BMW branded cars in the
world's largest car market.
The Munich-based auto maker is helping its Chinese partner
develop engines and a next generation minibus as it seeks to
deepen its foothold in China where restrictions prevent foreign
owners from exerting full control over local manufacturers.
"This is a partnership, but not formalised," Kastner said in
an interview at China Auto, the motorshow in Beijing.
"This is a project that started a while ago, where we
coached Brilliance on the minibus project. But they sourced and
built it," Kastner said, adding that the minibuses may soon be
launched under a new brand but he declined to elaborate further.
"I can't say yet. The name isn't out," Kastner said.
BMW has also been helping a Brilliance unit Mianyang Xinchen
Engine Co., Ltd., which is also known as XCE, with engines,
"We deliver some materials to XCE, an engine manufacturer
belonging to their group," Kastner said.
Both deals are a sign of the BMW's efforts to deepen ties
with its Chinese partner despite formal rules that limit the
influence of foreign car companies in China.
Foreign automakers are required to structure their China
investments as joint venture companies with state-owned
enterprises, and are limited to a 50 percent ownership cap.
In addition to the ownership threshold, the current policy
calls for foreign automakers to set up a jointly-run technical
centre in China and to transfer certain technologies to their
As a result, BMW Brilliance has launched an electric
vehicle, the Zinoro, loosely based on a BMW X1, a four-seater
with an operating range of around 150 kilometres.
For the time being, the Zinoro will only be available for
rent of around 400 Renminbi per day or about 7,400 Renminbi a
month if it is rented for a three-year term.
When asked whether BMW and Brilliance would consider
modifying their ownership structure to mirror a similar deal
done recently by rival Daimler and its partner
Beijing Automotive, which allowed Daimler to take a 12 percent
stake in a Hong-Kong listed unit BAIC IPO-BAC.SS, Kastner
"I think you would have to ask my shareholders to answer
that question. We had a very good run and in that respect we
have a lot of discussions about how do we continue localisation.
The rest can be answered by Hong Kong or Munich."
(Reporting by Edward Taylor; Editing by Rosalind Russell)