Daimler cuts stake in Chinese electric car venture with BYD
Daimler AG will slash its stake in the Denza electric-car joint venture with China’s BYD Auto Industry Co. following years of weak sales for the brand.
BYD will own 90% of the business and Daimler 10% after an equity transfer the companies plan to complete in mid-2022, the Mercedes-Benz maker said Friday. The 50-50 joint venture was started in March 2012.
“Daimler and BYD remain dedicated to their successful long-term partnership," Daimler said in a statement. The Denza brand will introduce new models next year and “seek further growth opportunities."
Tepid demand for Denza cars and the venture’s weak profitability have been a concern at Daimler for years, even as sales for its Mercedes luxury vehicles continued to surge in China. Daimler and BYD established the brand a decade ago to tap growth in the Chinese new-energy vehicle market.
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Daimler had folded the Smart minicar brand into a joint venture with Geely Holding in China and sold the unit’s French factory to Ineos Group. The moves are part of a strategy shift under Daimler Chief Executive Officer Ola Kallenius to focus on luxurious cars packed with sophisticated electronic gadgetry.