Daimler Signs A Deal with BAIC US$2.87 billion

The picture may seem familiar: Chinese and German businesspersons on the same table signing some papers, while German Chancellor Dr. Angela Merkel, and Chinese Prime Minister Wen Jiabao, standing behind them with their country flags are floating in the background.
Only this time the Germans are Daimler’s executives, not Volkswagen’s, and the other signatory is BAIC (Beijing Automotive Industry Corporation).
The deal involves Daimler investing $2.87 billion (€2.0 billion) to expand its operations with BAIC, called Joint Venture Beijing Benz Automotive Co, Ltd.
"As early as 2020, at least one in five premium compact cars is expected to be sold in China," Daimler CEO Dieter Zetsche said. So it makes perfect sense for the company to expand its activities in the local market.”
This year, the GLK SUV will be added to Mercedes-Benz’s Chinese range and production of theC-Class and E-Class, which is currently 80,000 units per year, will increase according to demand.
In addition, from 2013 three new (yet unspecified) premium compact cars will be added to the luxury carmaker’s China market range. In the same year, a new engine factory with annual capacity of up to 250,000 units will produce 4-cylinder gasoline engines for the local market and a new R&D center will be established.

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