Dongfeng Motor and First Automobile Works to Merge?

New speculation about a merger of China’s two largest state-owned car companies, Dongfeng Motor Corp. and First Automobile Works Group, has surfaced after the two companies swapped high-level executives last month, The Nikkei says.

The unusual exchange began with an April 6 announcement that An Tiecheng, general manager of FAW Car, was being appointed deputy general manager of Dongfeng Motor. A day later Qiu Xiandong, a former vice president of Dongfeng Motor Group, was named deputy general manager of FAW Group. The deputy general manager position ranks just below a company’s chairman and president.

Rumors about a possible deal between the companies aren’t new. Two years ago the two companies swapped chairmen. And in February the automakers agreed to collaborate on fuel cells, connected-car systems, vehicle weight reduction and other technologies. The companies also are partnering on a new technical innovation center.

The Nikkei notes that China has merged other state-owned companies in the past two years. In 2015, the government combined two train manufacturers (CSR Corp. Ltd. and China CNR Corp.). Last autumn the government merged two steelmakers (Baosteel Group and Wuhan Iron and Steel Group).