Daimler shares are trading lower Thursday, as the German carmaker announced it will purchase a 3.93% stake in the Beijing Electric Vehicle Co., a subsidiary of BAIC. The move comes as Daimler steps up its plans to develop its electric vehicle capabilities.
By 1120 BST, Daimler shares were 1.52% lower at €66.82. The stock price has been on a general downward slope in 2018, to-date.
Securing deeper ties
The deal follows an agreement between Daimler and BAIC in June 2017. It confirms a deeper professional understanding between the two businesses as they co-operate more closely on developing greener vehicles for the China market.
“Electric mobility is one of the pillars of Daimler’s future mobility strategy,” said Hubertus Troska, Member of the Board of Management, Daimler AG, responsible for Greater China.
“The investment in BJEV marks yet another milestone in the strong cooperation between Daimler and BAIC for New Energy Vehicles in China, and it underlines our commitment to the further development of electric mobility in this country,” Troska said.
BAIC chairman was equally upbeat on the deal: “New Energy Vehicles are one of BAIC Group’s core business areas, and Daimler’s investment in BJEV further expands our partnership,” said BAIC Group chairman, Xu Heyi.
The move comes as rival Geely unveiled it had gained a 10% stake in Daimler, as it seeks to gain easier access to green and more energy efficient vehicle technology.
Daimler share gains expected
As Daimler continues to develop its electric vehicle plans, analysts have raised their price target for the German carmaker.
Earlier this week, analysts at Equinet gave the stock an €80.00, 12-month price target and a ‘buy’ rating.
Other recent price targets on the stock include:
- Citigroup has a €76.00 price target and a ‘neutral’ rating.
- JP Morgan Chase has an €85 price target and a ‘buy’ rating.