A Chinese carmaker will spend $34 billion on fresh research and new vehicles to support its rapidly-growing ambition in the world’s biggest auto market.
Many companies have invested in China over the years, but a closely held private company called Tencent Holdings launched a venture with its rivals two years ago called Chery Automobile Co. to develop future vehicles to be sold under a subsidiary brand.
The unusual alliance has evolved into a bigger partnership now, with Chery state-owned by the government, and now planning to triple its research and development spending on the new brand while using Tencent’s ride-hailing platform and extensive payment and social-media holdings.
That will include spending at least $29 billion on cars, parts and technology over the next five years and hundreds of millions more for software and a new digital payment system.
Chery and Tencent will also develop a premium driving experience at home in China and abroad, with a focus on luxury vehicles.
At the same time, the companies said that Chery’s existing vehicle lineup, which includes affordable Chinese hatchbacks, cars aimed at emerging markets and micro-cars, will remain unchanged.
Tencent and Chery expect to announce new Chinese vehicle models in 2018 and overseas brands next year. The brands are scheduled to launch between 2019 and 2020.
Read the full story here, courtesy of The New York Times.