Daimler AG., the maker of premium Mercedes-Benz vehicles has signed a 1 Billion Euros ($1.37 billion) investment deal with Beijing Automotive Industry Corporation to expand car and engine production in China.
Daimler who builds engines, Mercedes E-Class C-Class and GLK models in China, says the new agreement will double the output to 200,000 vehicles and 250,000 engines a year in 2015.
“The agreement we have signed today shows once again that we are making steady progress in China together without longstanding partner BAIC,” Daimler Chief Executive Dieter Zetsche said.
Germany is China’s biggest trading partner in Europe, while China is Berlin’s biggest in Asia.
For the first two months, Daimler’s sales in China rose more than 50 percent. Globally, Mercedes sales are up 17 percent in 2014 – beating BMW’s gain of 6.6 percent and Audi’s 9.3 percent. The German automaker plans to sell about 500,000 new vehicles in China next year. Under Hubertus Troska, the new CEO of Daimler’s China operations, the automaker opened 75 new dealers last year – and plans to add 100 more until the end of 2015.
The new agreement was signed in presence of Germany’s Chancellor Dr. Angela Merkel and the Chinese State President Xi Jinping.