Chery Invests $75 Million in South Korea's KG Mobility

China's Chery Automobile signed an agreement Sunday at the Grand Hyatt Seoul to invest $75 million in South Korean automaker KG Mobility (KGM) via convertible bonds. If converted to shares, the investment will grant Chery a stake of approximately 10% in KGM. The partnership is designed to accelerate the launch of new models and reduce development costs by leveraging global production capacities.

Central to the deal is the development of a midsize SUV, codenamed SE-10, which will utilize Chery's T2X vehicle platform. The model will feature gasoline and plug-in hybrid versions, with projected launch dates ranging from January to early 2027. To broaden their technical synergy, the companies formed a task force to explore cooperation in semiconductors, robotics, steel, and raw materials.

Leadership from both firms characterized the deal as a strategic necessity for survival in the global industry. Chery President Zhang Guibing emphasized the importance of scale and overseas expansion, while KGM officials clarified that the minority stake would not impact the company's management control. KG Mobility also confirmed it has no plans to produce Chery-branded vehicles.