Not "strip and flip" Chrysler, Cerberus bet on China market

Chrysler was merged by Cerberus Capital Management, but its investment in the China market never change, Chrysler's officials said, adding possibility of further enhancement.

Cerberus insisted that it is focused on the long-term success of the acquisition, "We want to be part of restoring Chrysler to the front ranks of the auto industry, where it belongs," said Cerberus Chairman John W. Snow. He promised to maintain Chrysler's three brands intact and to shield Chrysler managers from the scrutiny of Wall Street, giving the automaker room to make a new start. The former Treasury secretary's words cleared the union's concern that Cerberus would strip and flip Chrysler, sent the workers jobless.

DCX currently have several cooperation programs in China, of which only the commercial vehicle program is operated by Daimler alone. With the two broken up, these programs in China will be adjusted. As to how much the operations here will be transferred, depends on the wait for the North American business to be cleared. BeijingBenz-DaimlerChrysler Automotive Ltd. (BBDC) is DCX's largest cooperative item in China, whose product portfolio includes Chrysler and Benz brands. A BBDC official who insisted being unnamed said that he thought the current production of the well-sold Chrysler 300C, new Mercedes-Benz E-Class sedans and the planned production of Sebring won't be affected. Gunter Butschek, president and CEO of BBDC told the press that the partnership will break even this year.

Chrysler's OEM deal with Chery, an independent Chinese automaker is reported to be halted, but DCX Northeast Asia spokesman Trevor Hale is still confident that they'll keep the negotiations on track.

The Chery deal, struck last December, was considered a breakthrough for Chrysler, which was searching for a low-cost partner to build and supply subcompacts. Chery was scheduled to make cars under the Dodge brand for the US and European markets.
Chrysler also plans to enhance its parternerships with Fujian Motor Industry Group and Southeast Motors.

DVX is lagging behind its competitor, such as GM, VW and Toyota, in China's fast-growing vehicle market. Chrysler CEO Tom LaSorda said last week that the automaker wanted to expand the Chery deal or seek other international partnerships. Possibly new Chinese investments or cooperators will be announced by Chrysler in the future.

"We have stipulated a long-term scheme for Chrysler's operation at the Chinese market, and we will revise it every three to six months,"  Eric Ridenour, Chrysler's chief operating officer, declared at Shanghai auto show this Mar..