Key facts
- Chery Automobile will invest $75 million in KG Mobility through convertible bonds.
- The investment could result in Chery holding a 10% stake in KG Mobility.
- The companies plan to explore cooperation in manufacturing, distribution, and potentially entering the U.S. market.
- KG Mobility will use Chery's T2X vehicle platform for a new midsize SUV launching in January.
- A joint task force will explore collaboration in semiconductors, robotics, raw materials, and steel.
China's Chery Automobile has agreed to invest $75 million in South Korean automaker KG Mobility Corp through convertible bonds, a move that could grant Chery a 10% stake in the company. The partnership aims to leverage Chery's global manufacturing bases for future cooperation, potentially sharing production capacity and collaborating on various manufacturing aspects.
Chery International President Zhang Guibing highlighted opportunities in distribution channels and brand collaboration, emphasizing a key objective to strengthen presence in overseas markets. Chery is also actively exploring entry into the U.S. market, though it acknowledges the need to comply with extensive regulations.
KG Mobility, formerly SsangYong Motor, is set to launch a new midsize SUV in January utilizing Chery's T2X vehicle platform, with gasoline and plug-in hybrid versions planned for both domestic and international sales. While there are no immediate plans to export this model to the U.S., the possibility remains open.
KG Mobility, which ranks behind Hyundai, Kia, and General Motors in South Korea, sold over 55,000 vehicles in the first half of the year, with exports comprising approximately 60% of its total sales. Beyond vehicle production, the two companies will establish a task force to explore cooperation in areas such as semiconductors, robotics, raw materials, and steel.