(Yicai) Oct. 8 -- Three joint ventures newly set up by Midea Group and Electrolux in North America have begun operations, with the aim of doubling annual production of refrigerators and washing machines in the market.

The tie-up between the two home appliance giants will enable full-chain integration of research and development, manufacturing, and marketing for their North American businesses, the Foshan-based company announced on Oct. 3. They will also jointly explore multi-category and cross-market collaboration opportunities, it added.

Midea and Electrolux will prioritize expanding local production capacity in North America, optimizing local manufacturing, shortening product delivery cycles, and improving supply chain responsiveness. They will also leverage their local sales networks to support product upgrades, channel expansion, and category deployment across the market.

The two companies reached a deal on creating the joint ventures at the end of April, with Electrolux agreeing to transfer a 65 percent stake in its refrigerator plant in Juárez, Mexico to Midea along with 45 percent of its laundry care appliances factory in Anderson, the United States. In addition, the pair will form a 50-50 JV to handle fridge and freezer sales in North America.

Midea’s North American own-brand manufacturing business has focused mainly on air conditioners, Wang Juan, senior analyst at Industry Online, told Yicai. Without local in-house production bases for fridges and washers, its production footprint in these two categories remained limited, she added.

The partnership will allow Midea to produce in North America, Wang said, helping the Chinese company bypass tariff barriers and quickly access North America’s mid-to-high-end white goods market by drawing on Electrolux’s brand power and offline sales channels.

Midea’s revenue from own-brand manufacturing in the US climbed 24 percent in the first half of this year from a year earlier. Its market share there for packaged home ACs was 46 percent, while that for top-mount freezers reached almost 15 percent.

As Midea’s cooperation with Electrolux deepens, the market share of Chinese-owned brands in North America’s fridge and washer segments will increase over time, Wang noted, amid competition among US, Chinese, European, and South Korean producers.

Editors: Tang Shihua, Tom Litting