Chery Automobile has formally agreed to invest $75 million in South Korean automaker Kestrel through convertible bonds, according to reports. If all bonds are fully converted, Chery will hold approximately a 10% equity stake in Kestrel. This move marks a significant step for Chery in strengthening its overseas market presence and deepening international partnerships.

On the product front, the first collaborative vehicle is set to launch next year. Kestrel, formerly known as Ssangyong Motor, ranks as South Korea's fourth-largest automaker by sales, behind Hyundai, Kia, and GM Korea. In the first half of this year, Kestrel sold over 55,000 vehicles domestically and abroad, with exports accounting for about 60% of total sales. The partnership's initial result will be a mid-sized SUV, codenamed SE-10, scheduled for release in January. This model will be built on Chery's T2X platform and will offer both gasoline and plug-in hybrid versions, targeting the South Korean and overseas markets. Chery International President Zhang Guibing told media in Seoul that Chery's numerous global manufacturing bases could become key areas for future collaboration, with both companies exploring shared production capacity and cooperation in manufacturing, distribution channels, and even branding. Regarding the closely watched U.S. market, Zhang revealed that Chery is actively exploring entry options, but only on the condition of full compliance with local legal and regulatory requirements.

Beyond vehicle manufacturing, the collaboration is expanding into broader fields. Kestrel Chairman Kwak Jae-sun disclosed that a special task force will be established to explore deep cooperation in semiconductors, robotics, raw materials, and steel, aiming for resource complementarity.

This partnership also evokes memories of Chinese automakers' overseas expansion history. Kestrel's predecessor, Ssangyong Motor, was once acquired by SAIC Motor in 2004. However, due to mismanagement during integration and frequent strikes, Ssangyong filed for bankruptcy protection in 2009, leading SAIC to relinquish control and exit at a loss of approximately 4 billion yuan, marking a notable failure in Chinese auto cross-border M&A history. Unlike SAIC's heavy-handed "full acquisition and complete integration" approach, Chery has adopted a lighter "technology licensing plus small equity stake" strategy. This method significantly reduces risk compared to full acquisition, while effectively leveraging Chery's technological strengths to participate in global competition with greater flexibility, avoiding the cultural and operational risks of direct management.