Sep 19, 2016 06:50 PM

FAW to Sell Hongqi Brand to Corporate Parent

A first-generation Hongqi, the same model in which Deng Xiaoping rode when inspecting People's Liberation Army soldiers during the 1984 National Day parade, on display in Changchun, Jilin province in 2014. Photo: Visual China

(Beijing) — State-owned FAW Car Co. Ltd. plans to sell its iconic Hongqi limousine model — used to carry state leaders and foreign dignitaries since 1958 — to its parent company in an effort to improve its balance sheet after reporting a net loss in the first half of this year.

Changchun-based FAW Car said in a filing with the Shenzhen Stock Exchange on Sunday that it plans to sell Hongqi, or Red Flag, to FAW Group Corp., adding that the poor performance of the luxury marque "to some extent has influenced the company's profitability and put pressure on its development."