Wanda sets up venture to sell Red Flag limousines in China even as it distances itself from the costly business of making cars

Wanda Automobile Technology Services was founded on Monday with a registered capital of 100 million yuan (US$15.65 million), according to sources close to the group. Tai Qing (Beijing) Technology, its joint venture partner, is a mainland Chinese firm that offers these services.

The new company’s formation comes after Wanda formed a partnership with FAW last month to provide user experiences for owners of the latter’s Red Flag cars. As part of the deal, cars of Red Flag, also known as Hongqi, will be sold at all Wanda Plazas across China starting in Beijing on January 8, according to the sources.

“The two companies are building a mutually beneficial partnership, where Red Flag cars will be able to tap Wanda Plazas’ huge foot traffic, while Red Flag owners will be able to enjoy free parking, free movie tickets, easy charging and more,” the sources said.

A total of 25.31 million cars were sold in China, the world’s second largest automobiles market, last year. Of these 1.4 million were electric vehicles (EVs).

But Wanda was “by no means going into the business of making cars”, despite forming Wanda Automobile, the sources said. The idea is that Hongqi vehicles will be sold at Wanda Plazas, while a range of cars services will be provided by the joint venture Wanda Automobile in the car parks.