Geleximco Group and Chery International enter automobile joint venture

April 04, 2024 | 15:35
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Geleximco Group and Chery International on April 4 signed an agreement to set up a joint venture to build an automobile factory in Vietnam.

Having a capacity of 200,000 units per year, the factory will produce OMODA and JAECOO car models. The construction will be carried out in three phases, with a total investment estimated at more than $800 million.

The first phase is expected to be completed in the first quarter of 2026.

Geleximco Group and Chery International enter automobile joint venture
Geleximco Group and Chery International signed a cooperation agreement on April 4

Addressing the event, Nguyen Hong Dien, Minister of Industry and Trade said that manufacturing and assembling cars powered by electric engines is an inevitable global trend, including in Vietnam, to achieve net-zero goals.

In Vietnam, after COP26, the Vietnamese government directed the development of a series of master plans and policies to encourage the development of electric vehicles (EVs). There is a mechanism to encourage vehicle lines like those to be developed by the joint venture of Geleximco and Chery International.

“The factory by the joint venture is going in the right direction consistent with Vietnam's guidelines, mechanisms, and policies. Investing in Vietnam, the joint venture not only taps into the domestic market of 100 million people, but also has the opportunity to exploit the market of five billion consumers in countries which are members of new-generation free trade agreements with which Vietnam is a member nation," the minister said.

The event not only marks a big step of OMODA and JAECOO in Southeast Asia, but also the first time that a new Chinese energy car brand has built a factory here.

The two sides plan to build a factory in Thai Binh province. As a coastal province in the north, Thai Binh has a strategic geographical location. In recent years, the province has been ranked among the leading provinces in terms of economic growth across the country, with an open and improved business environment.

Vu Van Tien, chairman of the Board of Directors of Geleximco Group said, “We are in a promising opportunity, when two reputable and capable corporations decide to cooperate."

Geleximco, with more than 30 years of experience in investing and developing large projects, has affirmed its position in many fields, from real estate, infrastructure, to energy and technology.

Meanwhile, Chery Group, one of China's leading names in the automotive industry, has contributed to bringing the Chinese brand to the world and is present in more than 80 countries.

“Once operational, the project will bring many important economic and social benefits not only for businesses but also contribute to the sustainable development of the locality and the country,” Tien added.

Geleximco Group and Chery International enter automobile joint venture
OMODA and JAECOO car models were introduced at the event

Zhang Guibing, general manager of Chery International said “This cooperation shows that the two sides have seen the inevitable trend of rapid change in global energy to achieve complementary advantages. It's a strong combination.”

“In the first phase, the two sides will jointly contribute capital to build a vehicle factory in Vietnam with a production capacity of 200,000 vehicles a year to provide Vietnamese consumers with new energy products under the trendy and technologically advanced OMODA and JAECOO brands. Then we will build an industrial cluster of complete vehicle and spare parts factories. After achieving a certain scale, it will export to ASEAN countries and others, making it one of Chery's key bases globally.”

During the factory construction process, OMODA and JAECOO will approach the Vietnamese market by importing complete vehicles. They are expected to be launched in the market at the end of 2024, with the pure electric smart crossover SUV OMODA E5 and The JAECOO 7 PHEV to be the first models.

Founded in 1993, Geleximco is one of the top 10 prestigious private corporations in Vietnam. It has total assets of $3.6 billion at the end of 2023. It operates in several key industries, including industrial production, infrastructure – real estate, banking and finance, and trade services.

Geleximco plans to grasp the Industry 4.0 trend, focusing on developing high-tech industrial production, investing in transport infrastructure, highways, seaports, and logistics. This also shows the consensus of the two parties on sustainable development strategies.

In recent years, China's new energy vehicle technology has reached out globally. The OMODA and JAECOO brands have also made breakthroughs in the world's new energy vehicle field, constantly launching new products and technologies.

As of 2024, the global cumulative sales volume of the OMODA and JAECOO brand has exceeded 160,000 units, attracting young people in nearly 20 countries and regions. The first pure electric vehicle model, OMODA E5, has been recognised by senior leaders of the governments of Indonesia, Malaysia, Thailand, Turkey, and Spain, becoming a "new force" in the global vehicle market.

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By Bich Thuy

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