'); //-->
AFX News Limited
Nanjing Auto revival plan for MG Rover approved by Chinese govt - UPDATE
(Updating with further details, background, comment)
BEIJING (AFX) - China's National Development and Reform Commission has approved Nanjing Automobile's turnaround plan for collapsed British car brand MG Rover, state media reported.
The approval means that the Chinese automaker will be able to restart production of cars under the MG and Austin brands, which it bought for 53 mln stg from the MG Rover Group last July.
The decision sets the stage for MG and Austin cars to be sold in China, the Shanghai Daily reported.
Nanjing Auto will have the potential to make 200,000 cars, 250,000 engines and 100,000 gearboxes annually, as the assets acquired from MG Rover also include research and development equipment, the newspaper said.
Citing Nanjing Auto chairman Wang Haoliang, Xinhua news agency added that the production lines and the research and development center of 'Scheme 566', the name given to the purchase deal, will be located in Nanjing, capital of east China's Jiangsu Province.
'We will produce top-grade MG-75 sedans in Pukou of Nanjing,' Xinhua quoted Wang as saying.
'The first car is hopefully to be rolled off the production line in the first half of 2007,' he said.
The Oriental Morning Post, a Shanghai-based newspaper, said that Nanjing Auto is expected to launch its first MG model on March 27 next year, the Chinese automaker's 60th birthday.
The newspaper said the MG series will be renamed as MG3Z, MG5Z and MG7Z, from the original MGZR, MGZS and MGZT.
Nanjing Auto will compete in selling cars developed by MG Rover with Shanghai Automobile Industry Corp (SAIC), which lost out in the bid for the bankrupt UK carmaker last year, but managed to buy the rights and assets for the manufacture of the Rover 75 and Rover 25 models and related engines.
SAIC's first model, a new generation Rover 75, is scheduled to be launched in September, ahead of Nanjing Auto's MG launch.
The price tags on the new vehicles is still unkown.
Yale Zhang, head of auto consultancy CSM Worldwide's China operations, said he favored SAIC over Nanjing Auto because of its better-organized structure, larger size and greater number of engineers.
'Personally I like SAIC more because it is much bigger, has more capital, more engineers and is a better organized company,' Zhang told XFN-Asia.
Nanjing Auto last month signed a 33-year lease agreement for the MG Rover UK plant at Longbridge in Birmingham.
The facilities Nanjing Auto is leasing comprise the South Works of the MG Rover plant, which incorporates two car assembly plants, the paint shop and administrative offices.
will.davies@xinhuafinance.com
wd/dj/dk
Neither the Subscriber nor AFX News warrants the completeness or accuracy of the Service or the suitability of the Service as a trading aid and neither accepts any liability for losses howsoever incurred. The content on this site, including news, quotes, data and other information, is provided by AFX News and its third party content providers for your personal information only, and neither AFX News nor its third party content providers shall be liable for any errors, inaccuracies or delays in content, or for any actions taken in reliance thereon.
1 of 1
'); //-->
News Headlines | More From Forbes.com | Special Reports
Subscriptions >
Rover 75
The Chinese National Development and Reform Commission approved today the plans by Nanjing Automobile Group to revive the MG Rover brand. 

Nanjing Automobile are planning to annually produce 200,000 cars, 250,000 engines and 100,000 gearboxes on the assembly lines purchased from MG Rover.

The first MG produced in Pukou in Nanjing in the east of China will be the sedan version of MG-75, in the first half of 2007.