According to the report, state media have claimed that Nanjing Automobile has run into difficulties concerning its expansion plans pertaining to its acquisition of the former UK-based OEM. Nanjing MG is also believed to be withdrawing from a project to build an assembly plant in Ardmore, Oklahoma.

China: SAIC open to tie-up with Nanjing Automobile for own-brand vehicles
Automotive World, 19 April, 2007
By Automotive World staff writer (DI)

According to a report carried by The Associated Press, SAIC plans to co operate with Nanjing Automobile, another state-owned vehicle manufacturer, to jointly develop a range of own-brand cars.

Nanjing Automobile owns the assets of the former MG Rover Group, while SAIC, which lost out to Nanjing for control of the company, bought the technology for two MG models, the Rover 25 and Rover 75. Its version of the latter, the Roewe 750, was launched in China in late 2006.

"I can declare we are looking forward to co-operation with Nanjing Automobile. We need to use state assets more efficiently and effectively. We believe the leaders of Nanjing Automobile are smart enough to understand this principle," SAIC chairman, Hu Maoyan was quoted by The Associated Press as saying.

Such a move would be in line with the Chinese government's strategy of consolidation in the industry. The government has traditionally encouraged co-operation, so a few strong local brands can compete in global markets. Regional rivalries however, stand in the way of such tie-ups.

According to the report, state media have claimed that Nanjing Automobile has run into difficulties concerning its expansion plans pertaining to its acquisition of the former UK-based OEM. Nanjing MG is also believed to be withdrawing from a project to build an assembly plant in Ardmore, Oklahoma.

SAIC, China's biggest publicly traded automotive OEM, continues to see strong sales from its joint ventures with General Motors and Volkswagen. The company plans to launch own-brand models across the entire vehicle spectrum. In the pipeline is a Roewe W2 concept, slated for production by the end of 2007, the report says.

A recent report carried by local business daily, 21st Century Business claimed that Chery Automobile, China's biggest independent OEM, is holding talks to buy an undisclosed stake in Nanjing Fiat Automobile, Fiat's joint venture with Nanjing Automobile.