The BMW Group's increase in the shareholding ratio of its joint venture in BMW Brilliance has finally come to fruition.

　　On February 11, the BMW Group officially announced that from February 11, 2022, the new joint venture contract of BMW Group's joint venture BMW Brilliance Automotive Co., Ltd. (hereinafter referred to as "BMW Brilliance") in China will come into effect. The validity period of the joint venture cooperation between the partners is extended to 2040 accordingly.

　　Since then, the BMW Group has officially become the first foreign-funded enterprise in China to increase the equity of the joint venture from 50% to 75%. According to previously disclosed information, BMW paid 3.7 billion euros (26.7 billion yuan) in cash for the deal to gain control of the joint venture.

　　BMW said the increased stake will have a one-time positive impact of 7 billion to 8 billion euros on the financial performance of its automotive business and increase free cash flow by about 5 billion euros.

　　BMW was able to further increase its shareholding ratio thanks to my country's continuous opening to the policy of the auto industry.

　　As early as 2018, my country lifted the foreign shareholding restrictions on new energy vehicle companies, which enabled Tesla to build factories in China as a sole proprietorship. BMW Group also reached an agreement with Brilliance Auto to increase its shareholding ratio that year. The agreement will go into effect in 2022, as stated in that year's policy.

　　In 2020, my country will cancel the restrictions on the foreign shareholding ratio of commercial vehicles. It is only a matter of time before the restrictions on the shareholding ratio of the passenger vehicle industry are lifted.

　　So on December 27, 2021, my country officially released the "Special Administrative Measures for Foreign Investment Access (Negative List) (2021 Edition)". The policy stipulates that starting from January 1, 2022, in the field of automobile manufacturing, the restrictions on foreign shareholding ratio in passenger vehicle manufacturing will be cancelled and the same foreign investor may establish two or less joint ventures in China to produce similar vehicle products. limit.

　　The abolition of the shareholding limit for passenger vehicles marks the complete opening of my country's auto industry to the outside world. BMW Group is the first to eat crabs in this policy.

　　Zipse, chairman of BMW Group, said: "Today marks an important step for BMW Group's investment in China. We will continue to strengthen our long-term commitment to the Chinese market and continue our business development."

　　As a concrete measure of BMW's continuous investment in China, BMW Brilliance will see another increase in production capacity this year: the existing plant in Shenyang's Dadong District is currently undergoing a comprehensive expansion, and a new plant in Tiexi District is also under construction. Thanks to this, the BMW Group's production capacity in China will be expanded, the variety of locally produced models will be further increased, and more pure electric models will be introduced for domestic production.

　　According to the plan, in 2022, the BMW brand will have 5 blockbuster pure electric models related to the Chinese market. Among them, the innovative BMW iX has released its price and completed its listing; i4 pure electric and pure electric 3 series produced in Shenyang will also have new news this year; and the first pure electric luxury flagship sedan BMW i7 will be unveiled during the year.

　　The BMW Group's goal is to provide about 13 pure electric products for the Chinese market by the end of 2023, and to convert 25% of sales in the Chinese market to pure electric vehicles by 2025.

　　Gao Le, President and CEO of BMW Group Greater China, said, "In the process of BMW Group's transformation towards electrification, digitalization and sustainable development, China, as a leader in these aspects, is our best choice and best partner. .The BMW Group will continue to call China home and walk with China."

　　In addition to the continuous promotion of electrification transformation in the Chinese market, the BMW Group is also increasing the number of localization of other models. The highly anticipated BMW X5 will officially enter the product lineup of BMW Brilliance this year. Previously, the model was imported from the United States.

　　Will BMW Group's investment to increase its equity in the joint venture company attract other joint ventures to follow suit? At present, this is only a case, and cannot be a reference for every enterprise in it.

　　The Volkswagen Group acquired a majority stake in the Volkswagen Anhui joint venture focused on electric vehicle production in 2020, while its stakes in SAIC Volkswagen and FAW-Volkswagen remain intact.

　　Mercedes-Benz owns a 49 percent stake in its Chinese joint venture, Beijing Benz. According to media reports in recent years, Mercedes-Benz is seeking to increase its stake, but has been repeatedly opposed by its partner "BAIC Group".

　　Japanese car companies represented by Toyota, Honda, and Nissan also operate 50-50 joint ventures in China. Although China has fully liberalized the shareholding ratio restrictions, according to the Nikkei Chinese website, executives of many large Japanese car companies believe that Japanese car companies attach great importance to the trust relationship with Chinese car companies, and that increasing the shareholding ratio needs to be carefully considered.

　　There are also some joint venture car companies that have to make changes based on the current business situation.

　　For example, recently, South Korea's Kia Corporation signed an expansion investment agreement with the Yancheng Municipal People's Government and Jiangsu Yueda Group. Dongfeng Motor Group withdrew from the previous tripartite joint venture. At present, Kia Motors and the Chinese Yueda Group are still in a 50:50 equity ratio.

　　According to the official introduction, the new joint venture company plans to increase its capital by 900 million US dollars, and rapidly increase vehicle sales and capacity utilization by expanding investment, introducing new models, developing new energy vehicles, and establishing export bases. According to the plan, the new company name will be released in April this year.

　　For another example, the Stellantis Group, which jointly operates the Peugeot Citroen, Jeep and Maserati brands in China, announced on its official website more than half a month ago that it would increase its stake in GAC Fick, a joint venture with GAC Group, from 50%. Overweight to 75%.

　　Although GAC Group later told the media that the release was not recognized by it, it did not deny that "Stellantis Group will increase the shareholding ratio of the joint venture".

　　More details of the Stellantis Group's plans for the Chinese market will be announced at its global strategy briefing to be held soon.

　　In short, after the opening of the shareholding ratio, the BMW Group set a precedent. Whether there will be a follow-up company in the future depends on the operating status of the companies involved, as well as the voice and contribution of both parties in the joint venture. Judging from the current cases, some are foreign parties taking the initiative to increase their holdings, and some are Chinese parties taking the initiative to withdraw. No matter how the shareholding ratio changes, most joint venture companies will still maintain the joint venture model, and no company is willing to switch from joint ventures to sole proprietorships. This shows that during the joint venture process for so many years, the foreign party still recognizes the contribution and role of the Chinese party.

　　Dong Yang, the former executive deputy secretary general of the China Association of Automobile Manufacturers and vice chairman of the China Electric Vehicle 100 Association, told Che Yun that this is a market behavior that needs to be carefully studied by both parties. And from the long-term development evaluation, there will not be a lot of follow-up.

　　Change and change are the result of the combined effect of multiple factors.