In a move that speaks volumes about the shifting power dynamics in China’s auto industry, Changan’s EV brand Deepal has officially taken over a former Hyundai plant in Chongqing. The deal, valued at 1.62 billion yuan (about 228 million USD), gives Deepal a massive, ready-made manufacturing facility to fuel its ambitious growth plans.
A Tale of Two Automakers
The factory itself tells a compelling story. Opened in 2017, Beijing Hyundai’s Chongqing plant was a huge investment, costing around 1.09 billion USD. It sprawls across 1.87 million square meters and was designed to build 300,000 cars annually. But as Hyundai’s sales struggled in the face of fierce local competition, the plant fell silent in December 2021, a ghost of a bygone era.
Selling it wasn’t easy. The facility was first listed in August 2023 for a hefty 3.68 billion yuan (517 million USD), but found no takers. The price was slashed twice more before finally selling for a fraction of its initial asking price. The final buyer was a state-owned investment firm under the local Chongqing government, which then transferred it to Deepal, illustrating the strategic industrial planning that shapes China’s automotive landscape.
Deepal’s Production Power-Up
For Deepal, this is a huge win. The brand is on a roll, with sales up 57.1% year-over-year from January to October 2024. Popular models like The Deepal S05 crossover are finding clear success, exceeding 20,000 global sales in October alone. With its existing plants in Nanjing and Beijing, adding the Chongqing facility gives Deepal the production muscle it needs to keep up with demand and launch new models.
While Deepal has confirmed it has a “plan” for the plant, it’s staying quiet about which cars it will build there or when the first one will roll off the line. The facility was officially rebranded with Deepal’s logo in late October, but the production lines remain still for now. This acquisition is a key part of Changan Automobile’s long-term capacity planning, which aims for a massive five million units annually across all its brands, including the popular Deepal S07.
The Bigger Picture
This isn’t just about one factory changing hands. It’s a snapshot of a bigger trend in China. Ambitious domestic EV brands are increasingly snapping up the idle factories of legacy joint ventures. It’s a smart, cost-effective way to expand, and it signals a passing of the torch from the old guard to the new, tech-driven players defining the future of the world’s largest car market. Deepal’s new plant is more than just a building, it’s a symbol of a new era.
