Chinese automaker Chery has agreed to invest US$75 million in South Korea’s KG Mobility (KGM), strengthening a strategic partnership aimed at expanding vehicle development, manufacturing cooperation and international sales.
The investment, which will be made through convertible bonds, could give Chery a stake of around 10% in KGM if fully converted.
Strategic Investment in South Korea
The agreement was signed in Seoul on 2 August during a ceremony attended by executives from both companies, including Chery Chairman Yin Tongyue and KG Mobility Chairman Kwak Jae-sun, as well as senior government representatives.
KGM said the investment marks another step in its collaboration with China’s largest passenger vehicle exporter as both companies seek to strengthen their competitiveness in global markets.
Expanding Global Cooperation
Chery International President Zhang Guibing said the partnership could extend beyond vehicle development to include manufacturing, production sharing, distribution networks and brand cooperation.
According to Zhang, Chery’s global manufacturing footprint provides opportunities for both companies to share production capacity and improve access to overseas markets.
The agreement reflects a broader trend of Chinese automakers partnering with established international manufacturers to utilise existing production facilities, strengthen local operations and expand global market access.
New SUV Under Development
The first product resulting from the partnership will be a new mid-size SUV, internally known as the SE-10.
The model will be built on Chery’s T2X platform and is expected to replace the KGM Rexton when it launches in early 2027.
KGM plans to offer both a 2.0-litre gasoline version and a plug-in hybrid electric vehicle (PHEV) variant.
The investment builds on earlier cooperation agreements, including a platform licensing agreement signed in October 2024 and a joint development programme for mid- and large-size SUVs announced in April 2025.
Broader Technology Collaboration
Both companies have also agreed to launch a second joint vehicle development programme targeting key markets including South Korea, China and Europe.
Beyond vehicle production, Chery and KGM plan to establish executive-level task forces to explore cooperation in automotive semiconductors, robotics, raw materials and steel.
The partnership will also examine opportunities for joint investment in overseas manufacturing facilities while leveraging each other’s production plants, supply chains and sales and service networks.
Chery sold approximately 2.8 million vehicles globally last year, including around 1.34 million exports, maintaining its position as China’s largest passenger vehicle exporter for the 23rd consecutive year.
