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Guangzhou-Fiat JV to make Chrysler Jeep in Changsha

By George Gao  From Gasgoo.comMay 17, 2010

Shanghai, May 17 ( Guangzhou Automobile Group Co (GAC) is expected to produce Chrysler's Jeep at its Changsha-based joint venture with Italian carmaker Fiat SpA, local media reported.

Fiat now owns a 20% share in the restructured U.S. carmaker Chrysler Group LLC, and the share could eventually grow to 35%. Fiat's new venture in China is planning to focus on more locally produced, competitive models, including the Chrysler Jeep.

In July 2009, Guangzhou Auto signed an agreement with Fiat to establish a joint venture in Changsha, capital of south central Hunan province, and planned to first make Fiat's 1.4-liter Linea sedan in 2011 when the production facility is completed.

GAC and Chrysler have also agreed to build Jeeps jointly in Changsha, with the Compass to the first model for Chrysler to resume Chinese production. The U.S. automaker has had no local partner in China since it pulled out of Daimler AG's joint venture with Beijing Auto in early 2009.

Fiat plans to produce and sell 300,000 vehicles, including Chrysler brands, in China by 2014. The Italian carmaker has Guangzhou Auto as its new partner in China after terminating its loss-making joint venture with Nanjing Auto in late 2007.

After withdrawing from their former ventures in China, both Fiat and Chrysler maintained their presence in the world's largest auto market by selling imported models. Without local production, they report sluggish sales in China.

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