Chrysler tried to sell parts to Chinese, form partnerships

Before filing for bankruptcy protection Thursday, Chrysler LLC in recent weeks sought to sell parts of the company to Chinese companies and explored partnerships with nearly every major automaker over the past two years -- including Toyota Motor Corp.

"Chrysler has attempted in recent weeks to sell product lines and other units to a number of Chinese companies, but these efforts too have been unsuccessful," Chrysler Co-president and Vice Chairman Tom LaSorda said in a affidavit filed in U.S. Bankruptcy Court in New York.

Chrysler hosted potential Chinese buyers at its Auburn Hills headquarters in February for five days, offering to sell engines, transmissions, vehicle lines and Chrysler's Newark paint shop.

"Chrysler sent letters to parties, primarily in China, whom we thought would be potentially interested in purchasing our assets," LaSorda wrote. "Over the next two months, several companies, including Beijing Automotive Industry Holding Co., Tempo International Group, Hawtai Automobiles, and Chery Automotive Co., expressed interest in purchasing specific vehicles, powertrains, intellectual property rights, distribution channels and automotive brands."

But none of those deals was completed because of the struggling economy.

A partnership with Fiat SpA that could lead to the Italian automaker controlling Chrysler outright is the best outcome, LaSorda said, after exploring partnerships with many major foreign automakers.

The filings show Chrysler's extensive efforts to find a partner. Chrysler CEO Robert Nardelli called then General Motors Corp. Chairman and CEO Rick Wagoner in January in a vain attempt to resurrect merger talks.

"Since that time, GM has consistently remained uninterested in reopening the discussions about a potential merger," LaSorda wrote.

Fiat is the best option, LaSorda said.

"It is Chrysler's last best hope. I know because I have spent over two years looking for, talking to and evaluating potential partners," LaSorda said. Chrysler's efforts to form alliances with Nissan, GM, Volkswagen, Tata Motors, Magna, GAZ, Hyundai, Honda and Toyota "have been determined and undertaken in good faith, but have met uniformly without success."

LaSorda crisscrossed the globe meeting with numerous automakers.

Chrysler approached Toyota in June, when LaSorda and former Toyota executive Jim Press -- a co-vice chairman and president at Chrysler -- "submitted a formal request to discuss potential joint opportunities." The letter suggested Toyota use Chrysler's excess capacity to build new products or work to develop advanced technology vehicles, such as hybrids. Toyota rejected the request in July.

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