It was announced in the middle of last year that the central government plans to consolidate the Chinese car industry, which now stands at around 89 different manufacturers and brands. The first to merge were SAIC and Nanjing MG, which made them into a regional power house, the Anhui duo Chery and JAC are rumoured to be merging sometime next year but in the meantime Chang’an has become the car company to accquire another.

The Aviation Industry Corporation of China (AVIC) currently has two car making ventures in China, one of which is the Changhe Automobiles, and the second is Harbin’s Hafei Automobile, these two entities will be signed over to Chang’an Automobile according to an announcement made this morning in the Great Hall of the People in Beijing.

The buyout also includes Changhe’s Suzuki joint venture and Harbin Dongan Auto Engine Company which also has a joint venture with Mitsubishi Automotive Engine. The deal looks set to give Chang’an a massive boost in the Chinese market place now that it has access to a wide range of vehicles, as well as engine joint ventures with foreign partners.

Financial details have not yet been released but as soon as the assets have been merged, AVIC will hold a 23% stake in the newly formed Chang’an Automobile Group, whilst the majority of shares will be held by Chang’ans parent company, China Weaponry Equipment group.

The “New Chang’an” will boast a yearly production 2.2 million vehicles, and is expected to produce nearly 5 million vehicles by 2020.

Chang’ans third quarter profit was over 300 million profit this year, partly thanks to its multiple joint ventures with Ford, Mazda, Volvo, and Suzuki, as well as its own vehicle line up.