By Kate Yuan

(JW Insights) Oct 7 -- China’s GAC Aion (广汽埃安), the EV brand of GAC Group, is expected to take over the production base of GAC Mitsubishi in Changsha of central China's Hunan Province, and convert it into an EV manufacturing facility, JW Insights learned.

Japan’s Mitsubishi has abandoned plans to restart its China factory operations since the factory ceased production in March this year, and intends to concentrate its resources in Southeast Asia and Oceania. Mitsubishi is reportedly in final negotiations with GAC Group.

The public relations officer of Mitsubishi recently denied these, saying the decision is still under discussion with shareholders and has not been finalized.

After the production halt at GAC Mitsubishi's factory due to poor sales of its new model, the shareholders of the joint venture need to provide RMB1.884 billion ($258.03 million) to support its normal operations.

In addition to acquiring the existing factory, production lines, and employees, GAC Aion is also expected to take over the RMB670 million ($91.76 million) R&D center, which includes several labs for styling, EMC, new energy as well as prototype workshop and research building.

The sales of GAC Mitsubishi in China have dropped from 144,000 vehicles in 2018 to 33,600 vehicles in 2022. GAC Aion is currently one of the best-performing companies among domestic new energy vehicle manufacturers. In September this year, it delivered 51,600 vehicles, exceeding 50,000 units for the second consecutive month. The cumulative delivery volume for this year has reached 360,000 vehicles.