China’s two largest car manufacturers, Nanjing Automotive Corporation (NAC) and Shanghai Automotive (SAIC) merged at a conference held recently in Beijing.There was fierce rivalry between the two automakers, with both companies owning parts of what was the MG Rover corporation – NAC has rights to the MG TF, ZR and ZT, and SAIC owns the Rover 25, 75 and the K-series engine.It took five months to come to an agreement regarding the merger, but SAIC finally bought out NAC for £144m.The two companies have agreed to merge all their combined resources, including research and design, sales and marketing, manufacturing and supply chain management, though the company will continue to trade under both names. The aim is to make SAIC into a large global manufacturer by giving it access to the MG brand and NAC’s more modern, larger production facilities, whilst NAC leads the operation in the home market. This is essentially a complete restructuring of the Chinese automotive industry; something the Chinese authorities were keen to see happen in order to make the country’s car industry more competitive.NAC had already begun production of the MG TF at Longbridge, and since the merger SAIC has stated that the UK operation remains central to the company’s plans, with the TF roadster leading the offensive over here. The only change expected to take place at Longbridge is an injection of more resources, so expect to see more new MG products soon after the launch of the TF next year.
