BAIC: Opel Bid Failed Because of Intellectual Property Issues

Beijing Automotive Industry Holding Company (BAIC), the Chinese holding company that submitted a late bid for General Motors’ European Opel division, said talks with the American automaker fell apart due to disagreements over intellectual property.

“In the negotiations over intellectual property, we have been in constant communications with U.S.’ General Motors,” BAIC said in an e-mailed statement to Reuters. “Regrettably, both parties failed to reach an agreement on the issue.”

Speculation that BAIC had withdrawn its bid began yesterday, when GM failed to mention the Chinese company’s name among the active bidders for Opel. Canadian supplier Magna International and RHJ International, a Belgian investment firm, are still in the running.

BAIC, which the Chinese government controls, is China’s fifth largest auto company, and produces vehicles through joint ventures with Mercedes-Benz, Chrysler, and Hyundai. The company wants to more than double its annual vehicle sales to 2 million units by 2015. Now that its Opel bid appears to have failed, sources told Reuters the company may turn its attention to a bid for Volvo.

Ford’s Volvo division has seen attention from at least two other Chinese companies, Changan Automobile Group, Ford’s manufacturing partner in China, and Geely, with reports suggesting the latter had signed a preliminary agreement. Reuters sources said the Beijing government would offer full support in BAIC’s bid for Volvo.

BAIC did not offer any details about what specific intellectual properties were the cause of the disagreement or what steps it might take now that its bid for Opel has ended.

Source: Reuters