Hyundai Motor Group, the world’s fifth-largest car maker by sales, said Tuesday it has formed a joint venture with Beijing Automotive Industry Group to provide auto loans in a bid to boost its car sales in China.
The joint venture, called Beijing Hyundai Auto Finance, will provide auto financing to customers of Hyundai Motor Co. and Kia Motors Corp. in China, Hyundai Motor Group said in a statement.
The initial investment in the auto-financing venture is 500 million yuan ($79.2 million), with Hyundai Motor Group taking a 60% stake with its consumer finance unit Hyundai Capital Services, while Beijing Automotive Industry Group has the remaining 40% stake.
“We are confident about our growth perspectives since only 10% of car purchases are financed by loans in China, a ratio that industry estimates will triple by 2017,” Ted Chung, chief executive of Hyundai Capital, said.
“Having a captive finance company will benefit Hyundai Motor Group in its future efforts to gain market share in the world’s largest car market,” Mr Chung added.
Marketwatch
