The news of Daimler AG buying a stake of Beijing Automotive Group (BAIC Group) has brought about a suspicion of some change in the joint venture operation between Hyundai Motor and the BASIC Group.
However, Dieter Zetsche, chairman of the Board of Management of Daimler AG, said in a press conference in Seoul on November 27 that the company has no intention to interfere with Hyundai Motor’s joint venture in China. He explained that his company’s recent buying of a 12 percent stake in the passenger car unit of BASIC Motor was intended to support the Chinese carmaker’s plan to launch its initial public offering and forge a close strategic partnership with the Chinese motor group.
Daimler AG said last week that the agreement between Daimler and the BAIC Group includes the assignment of two seats to the former on the board of directors of the latter. In relation with that, Zetsche said, “We do not intend to interfere in the joint venture business of Hyundai Motor with our two board seats in any form.”
Beijing Hyundai Motor, a 50-50 joint venture between Hyundai and the BAIC Group, operates three assembly plants in Beijing as of now, producing up to 1 million units per year.
Hyundai Motor has made no comment on the deal between Daimler AG and the BAIC Group.
Zetsche described his company’s relations with Hyundai as amicable, and did not see any conflict of interest, saying Daimler and Hyundai are basically not competitors in car markets including China, except in very limited segments.
Zetsche went on to say, “In every respect, safety or aesthetics, power or efficiency, comfort or dynamism, our aspirations are ‘the best or nothing.’ No other car stands for the Mercedes-Benz brand promise more than the S-Class.” He then stayed in Seoul to unveil the new Mercedes-Benz S-Class.
He added that his company will set up a new research and development center to tap South Korean talent and expertise in telematics, and said it was investing 52 billion won (US$48 million) to build a new parts distribution center by next year.
Zetsche’s comment came one day after Hyundai unveiled the luxury sedan Genesis in Seoul to improve the company’s brand image. Upon launching the sedan in Seoul, Hyundai Motor Chairman Jung Mong-koo said that the Genesis will compete with global premium brands such as BMW and Mercedes-Benz.