Doubts About Chinese Production of Chryslers Grow, as GAC-Mitsubishi Alliance Strengthens

   Date:2012-01-05

Gasgoo.com (Shanghai January 3) - With a slew of new partnerships materializing between foreign and Chinese automobile manufacturers in the end of last year, along with the implementation of anti-dumping policies for imported vehicles, industry analysts and the media have once again begun wondering if Chrysler will try to begin manufacturing vehicles in the country. In particular, the fate of Chrysler's Jeep brand seems to be strongly tied with its performance in the Chinese market.

According to a recent report appearing in the China Times, Guangzhou Automotive (GAC), Chinese partner of Chrysler's parent Fiat, has been holding off on talks to manufacture Chryslers in the country. According to the report, GAC is more concerned with the introduction of its first vehicle brought to the market in association with Fiat, the C-Medium, as well as pursuing a stronger partnership with Japanese manufacturer Mitsubishi. Since a lot of Mitsubishi's product line crosses over with Jeep's, a stronger alliance between GAC and Mitsubishi may further hinder Chrysler's plans to produce vehicles domestically.

Sergio Marchionne, CEO of Fiat and Chrysler, previously stated that he plans to see his companies' market share in China increase to two percent by 2014. If an average growth rate of ten percent is to be assumed, that will be equivalent to sales of around 480,000 vehicles, a target which will be hard to achieve with only Fiat models. With the introduction of economic policies aimed squarely at imported vehicles, it remains to be seen how Mr. Marchionne and Fiat will find a way to maintain growth in Chrysler and Jeep sales.

Officials from Fiat have not given any clear information regarding speculated plans to manufacture Chrysler models, or models from Fiat's other brand Alfa-Romeo, in China.

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