What is the reason for the cancellation of the Great Wall BMW Spotlight Automotive Project?
4 Answers
Great Wall BMW Spotlight Automotive Project has not been canceled. Here is the relevant introduction about Spotlight Automotive: 1. Introduction: Spotlight Automotive Co., Ltd. is a joint venture established by Great Wall Motor Co., Ltd. and BMW Holding Co., Ltd., with each party holding a 50% stake. 2. Company Plan: It will fully focus on the field of new energy vehicles, integrating and utilizing the technical, resource, and management advantages of both shareholders to develop a new generation of pure electric vehicles for the global market. 3. Platform Core: The core of this platform is the hybrid dual-axle drive technology, which can achieve complete decoupling of the front and rear axles. Based on traditional front-wheel drive technology, it adds hybrid technologies such as start-stop, motor boost, and engine power generation. Additionally, this platform also has high scalability, providing Great Wall with more possibilities to expand into the compact, mid-size, and large SUV segments. For example, the P8 model unveiled at last year's Guangzhou Auto Show is the first model built on the new energy technology platform Pi4.
I heard that the Beam project was halted mainly due to changes in the market environment. The electric vehicle sector has become too crowded in the past two years, with new players engaging in fierce price wars. Last year, subsidies were also reduced, making it difficult for high-end joint venture projects like this to achieve a reasonable return on investment within a short period. Both parties likely felt that the input-output ratio wasn't favorable. BMW is currently focusing on its iX series, while Great Wall Motors is prioritizing the Tank new energy lineup—each has its own strategic priorities. Additionally, with foreign investors now allowed to establish wholly-owned factories in China, the necessity of joint ventures has indeed diminished. Furthermore, supply chain issues have led to continuously rising costs, causing disagreements between the joint venture partners over additional investments. Ultimately, they had no choice but to cut their losses in time.
From a project advancement perspective, funding and product positioning are crucial. BMW and Great Wall had mismatched expectations for the electric MINI—one aimed for premium pricing while the other emphasized cost-effectiveness. The factory had just completed its infrastructure when the EV market cooled, with pre-orders falling far short of projections. High communication costs between the two brands also slowed decision-making and implementation. Pandemic-related capacity planning disruptions further complicated matters, leading both to favor asset-light collaborations like technology licensing. Eventually, they redirected resources to their respective more promising projects.
The cancellation of joint ventures is often influenced by policies. The initial establishment of Spotlight Automotive was to leverage the policy window for foreign ownership restrictions, which is no longer necessary after the liberalization. Both companies have their own layouts in core EV technologies, making joint development appear redundant. Recent changes in international trade relations have also significantly impacted supply chains, suddenly increasing the management difficulty of joint ventures. After careful consideration, both parties decided to pursue their own paths.
