In August, China's new vehicle sales continued to fall, following a drop in July.
Brilliance, which makes the vast majority of its revenue from BMW-branded cars, has seen its shares tumble almost 50 per cent this year on talk that such a deal was in the offing.
As part of the agreement reached with Brilliance, BMW will also extend the contract with the Chinese until 2040.
According to a press release posted on BMW Group's website, the company intends to increase its stake in BBA from 50 percent to 75 percent.
New investment, expansion in capacity At the same time, the BBA JV also announced an investment of more than three billion euros (Rs 25,809 crore) in new and existing plant structures in Shenyang over the coming years. The production capacity of Tiexi plant will be doubled.
The company sold 560,000 cars in China in 2017.
BMW said the goal of the arrangement was to boost production capacity at its current sites in Shenyang and expand the localization of other models like the so-called new energy vehicles.
BMW wants to start exporting cars from China.
"Given the trade dispute between the United States and China, there is a powerful incentive for automakers to produce vehicles in the market where they sell them", said independent vehicle-industry analyst James Chao. "Our success story goes hand in hand with the success of the joint venture BBA". Cars made under than partnership are aimed at the Chinese market.
In 2017, the BBA automotive plants in Tiexi and Dadong produced nearly 400,000 vehicles. The BMW Group will invest more than 3 billion euros (3.5 billion USA dollars) in new and existing plant structures in Shenyang over the coming years. At Plant Dadong, the BMW 5 Series Long Wheelbase version (including plug-in hybrid version) and the BMW X3 are manufactured.
Brilliance Auto, a state-owned vehicle company headquartered in Shenyang, briefly dropped 30 per cent to HK$7.51 on Friday morning before recovering slightly to close 27 per cent lower at HK￥7.90. Other Chinese auto stocks have also slumped amid investor concerns that the companies will be left with a smaller share of their ventures' future earnings should their global partners increase control. A large portion of those vehicles were destined for China.