SHANGHAI Dazhong Taxi Co will join the Chicago-based Hertz Corp to invest about US$6 million in car leasing and rental services in Shanghai and other parts of China.
Hertz, the world's largest car-hire company, aims to open up the China market with its expertise and global network in a business which is still new to the developing mainland cities.
The venture, owned two-thirds by Dazhong Taxi and one-third by Hertz, will build up the fleet in three phases up to 1995. Hertz is 49 per cent owned by Ford Motor Co and 26 per cent by AB Volvo.
The 20-year licence granted by China's State Industry and Commerce Administration signals the opening of the car-rental market to foreign investors.
Mr Michael Ning, assistant director at Dazhong Taxi's financial adviser Standard Chartered Asia, said equity and bank financing would make up equal portions of the $6 million project.
''Shanghai Dazhong Hertz Co, based in Shanghai, will build up a fleet of 800 cars, including ordinary and luxury cars,'' he said.