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Tmall, Jingu and Kangzhong Jointly Form Auto Aftermarket Service Firm

Sina Tech, 8/23/18

Alibaba Group's (NYSE: BABA) B2C e-commerce site Tmall recently announced that its automotive division will form an aftermarket joint venture with Zhejiang-based wheel and tire manufacturer Jingu's (002488.SZ) subsidiary car care platform Qiche Chaoren ("Car Superman") and Jiangsu-based Kangzhong Industry Investment's auto parts B2B e-commerce platform Carzone.

The new company will get a cash injection from Alibaba Group and merge Car Superman's supply chain company with Carzone. However, the new company will be operated independently from Tmall and sister site Taobao's after-market services (excluding car parts). Car Superman will be the second-largest stake holder after Alibaba. Carzone founder and president Shang Baoguo will serve as the first CEO and Tmall's head of automotive Cai Yongzhi will be COO. The new company will also take investments from Warburg Pincus, Yunfeng Capital, and Pacific Alliance Group.

Once the new company is established, its supply chain system will cover more than 80,000 stores across the country and include various parts and accessories, including engine oil, tires, batteries, and quick-wear parts. Core accessories will be equipped with a bar code, which users can scan with the Tmall or Taobao app to check sourcing and verify authenticity.

The new company will have central and regional warehouses in nearly 30 provinces and close to 600 storefront forward warehouses providing "5 km, 30-minute" delivery to over 70,000 auto repair shops.

Keywords: Carzone Shang Baoguo Cai Yongzhi VC B2B e-commerce Internet Pacific Alliance Group Warburg Pincus Alibaba Group BABA Jingu 002488.SZ Car Superman Kangzhong YF Capital JV automobile Yunfeng Capital

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The information contained in this newsletter is based upon sources that Marbridge Consulting believes to be reliable, and we have made every effort to translate the original articles or article excerpts as faithfully as possible. However, Marbridge Consulting makes no warranty of and assumes no legal responsibility for the accuracy of either the original source material or the English language translations.

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