The two-year-old relationship between Chery and KGM is getting a little more serious, with the Chinese firm buying into the automaker formerly known as SsangYong.
As part of the deal signed earlier this week in Seoul, Chery will invest US$75 million (A$106m) in KGM, although it’s unknown how much of KGM this equates to.
The two automakers say the latest deal will speed up new vehicle development as it combines “KGM’s know-how in product planning, design, and vehicle development with Chery Automobile’s eco-friendly powertrains and global platform technology”.
The first fruit from this cooperation will be Project SE-10, a mid-size SUV that will carry forward “the heritage of the Rexton”. It will be launched in early 2027 with the choice of a plug-in hybrid drivetrain or a 2.0-litre petrol engine.
Chery and KGM have committed to developing a second model together, but haven’t revealed any details about it. Beyond this they will work together on a series of vehicles targeting key markets, such as South Korea, China and Europe.
Other areas of cooperation include autonomous driving, robotics, software-defined vehicle architectures, and semiconductors.
The tie-up is the latest turn in SsangYong’s tumultuous corporate history. In 1997 Daewoo purchased a controlling stake in the firm, but by 2000 Daewoo was on the brink of collapse and SsangYong became independent once more.
Four years later Chinese automaker SAIC, the owner of MG and other marques, bought a controlling share. Sadly for SsangYong, its first Chinese entanglement didn’t work out well.
At the height of the 2008 global financial crisis, SAIC cut SsangYong adrift amid falling sales, losses, and allegations the Chinese company stole hybrid vehicle technology.
In 2011 SsangYong was bought by Mahindra, with the 2015 Tivoli and the Mahindra XUV300 being the first fruit from the marriage. In the middle of the COVID-19 pandemic Mahindra cut SsangYong loose and by the end of 2020 the Korean automaker had filed for bankruptcy protection.
The KG Group, a South Korean conglomerate mainly specialising in steel and chemicals, bought SsangYong out of bankruptcy in 2023, and began rebranding the automaker as KGM.
Chery isn’t the only Chinese automaker investing in South Korea, with Geely buying a third of Renault Korea Motors (formerly Renault Samsung) in 2022. The third-generation Koleos is a lightly restyled Geely Monjaro, while the new Filante flagship is also based on Geely’s Compact Modular Architecture.