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Magna Acquires Honglizhixin to Bolster Seating Capabilities in China

Auto News - Published on Tue, 08 Sep 2020

Image Source: Magna Honglizhixin Automotive Seating
Magna has signed an agreement to acquire majority ownership of Honglizhixin, a leading seat supplier to Chinese automakers. The acquisition will expand Magna’s seating capabilities across China. At the same time Magna will acquire a majority stake in its existing seating joint venture with HLZX. The two companies currently operate a 50/50 joint venture formed in 2015. Magna’s strong relationship with HLZX over the years has enabled agreements to deepen the partnership. Magna has signed a Shareholder Agreement and Share Purchase Agreement and intends to finalize the deals by the beginning of 2021, signaling a strong commitment to the China market.

The current Magna-HLZX JV includes two manufacturing plants. Under the new ownership agreement, 10 plants will be added to Magna’s manufacturing footprint, adding critical mass and scale to the company’s seating operations in China. The majority of HLZX’s plants are also vertically integrated with just-in-time seat assembly and delivery, structures, foam, and trim capabilities that enable an optimal sourcing solution for automakers versus sourcing from multiple suppliers.

Magna’s seating business, recognized by automakers and consumers for its innovation and quality, includes six R&D centers and 66 manufacturing operations around the globe.

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Posted By : Yogender Pancholi on Tue, 08 Sep 2020
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