File photo/Zhang Jian (NBD)

June 3 (NBD) -- Starting from July 1, 2019, some of Shenzhen DENZA New Energy Automotive Co., Ltd.'s businesses will be transferred to Beijing Mercedes-Benz Sales Service Co., Ltd. (BMBS), including car sale, marketing, brand building, customer services, and network development. 

DENZA's manufacturing as well as research and development will still be based in south China's Shenzhen, Duan Jianjun, chief operating officer of Sales & Marketing at BMBS, said to news outlet Yicai.

The announcement was made at the launch event for the DENZA ConceptX at the Shenzhen-Hong Kong-Macao International Auto Show 2019, which kicked off in Shenzhen on June 1. The mass-produced version of the mid-sized all-electric concept SUV is slated to hit the market in early 2020.

Formerly known as Shenzhen BYD Daimler New Technology Co., Ltd., DENZA started early in China's new-energy vehicle domain as a 50-50 joint venture of Daimler Greater China Ltd. and BYD's subsidiary BYD Automotive Industry Co., Ltd. 

National Business Daily noticed that DENZA has been relying on capital injections from shareholders to keep its business going. To date, its two stakeholders have infused over 4 billion yuan (580.6 million U.S. dollars) of additional funds to fuel its development, with the latest injection conducted in May this year.

The continuous infusions were a result of DENZA's long-run losses. Data shows that the company had lost more than 3.5 billion yuan cumulatively in recent five years. The loss in 2016 was 1.3 billion yuan, and then narrowed to 480 million yuan in 2017 but jumped to 890 million yuan last year, according to BYD's reports. 

Including DENZA models in BMBS' distribution network in China will likely open up new prospect for DENZA. BMBS now has nearly 600 4S stores across China, but due to the limited output, DENZA vehicles will be marketed in selected cities, Duan Jianjun said to Yicai. 

Whether the brand could win the favor of consumers will be up to its car pricing and positioning as well as endeavors of DENZA's shareholders, remarked Cui Dongshu, secretary-general of the China Passenger Car Association. Currently, DENZA has a simple product structure and is not very competitive in terms of pricing and brand appeal as compared to its rivals, Cui noted.  

Email: lansuying@nbd.com.cn