WSJ: Chrysler To Sell Chinese Made Cars In USA

[Perian]

Link: www.wsj.com

DETROIT -- DaimlerChrysler AG's Chrysler Group said Friday it has signed a letter of intent with China's Chery Automobile Co. that will allow the auto maker to build small cars in China that will be sold throughout the world, including the U.S.

Chrysler spokesman Jason Vines said the deal, which has been in the works over the course of the past year, is subject to approval by DaimlerChrysler's supervisory board. If approved, Chery will begin producing small cars for Chrysler "soon," Mr. Vines said. He said Chrysler plans to sell the vehicles in the U.S., Europe, China, Canada and Mexico.

Earlier this year, Chrysler signaled its intent to find a partner capable of helping the auto maker build small cars at a lower cost. Chrysler Chief Executive Tom LaSorda recently confirmed Chery was a potential partner.

Mr. Vines said Mr. LaSorda personally negotiated the pact with Chery. The executive had set a deadline on getting the deal done by the end of 2006.

Chrysler's agreement with Chery is unique among Detroit's Big Three as it is intended to allow a U.S. auto maker to build cars in China and sell them in the U.S. Chrysler, like General Motors Corp. and Ford Motor Co., is working with the United Auto Workers to lower labor costs, including health-care costs. By building small cars in China, Chrysler hopes to be profitable in a small-car segment that often returns meager or no profit margins.

[Perian]

Aveos from Korea; Little Neon-like cars from China.

All available soon on Main Street USA.

How about that.

[dmaxpwr]

[uujjj]

our foreign debt is now approaching 50% of the GDP. there's nothing wrong with the chinese making and selling cars, but we can't even afford the stuff we already import.

blocking chinese car imports isn't the solution, but we need to fix our economic policy and soon.

[Bravada]

Actually, they could've gone to Geely, they've got a model ideal for DCX already...



I also have to congratulate DCX on their strategy - their latest Chrysler Group cars are so crappy quality-wise that a Chery-made car would blend in without any problems!

More seriously - this further goes to support the point I've been making that Chinese automakers are unable to compete in developed markets on their own. Not long ago Chery was making dashing declarations on how they would take US (and other markets) with their new revolutionary (and visionary ) models and somehow they had to back off quietly and humbly accept DCX's offer of becoming their contractor. The mighty SAIC had to vie for the rights to warm over ancient Rover designs to have anything to even consider offering Western customers.

The Chinese ARE coming and this IS yet another step forward, but it's not THAT easy.

[Pontiac-Custom-S]

Originally Posted by Perian

Link: www.wsj.com

DETROIT -- DaimlerChrysler AG's Chrysler Group said Friday it has signed a letter of intent with China's Chery Automobile Co. that will allow the auto maker to build small cars in China that will be sold throughout the world, including the U.S.

Chrysler spokesman Jason Vines said the deal, which has been in the works over the course of the past year, is subject to approval by DaimlerChrysler's supervisory board. If approved, Chery will begin producing small cars for Chrysler "soon," Mr. Vines said. He said Chrysler plans to sell the vehicles in the U.S., Europe, China, Canada and Mexico.

Earlier this year, Chrysler signaled its intent to find a partner capable of helping the auto maker build small cars at a lower cost. Chrysler Chief Executive Tom LaSorda recently confirmed Chery was a potential partner.

Mr. Vines said Mr. LaSorda personally negotiated the pact with Chery. The executive had set a deadline on getting the deal done by the end of 2006.

Chrysler's agreement with Chery is unique among Detroit's Big Three as it is intended to allow a U.S. auto maker to build cars in China and sell them in the U.S. Chrysler, like General Motors Corp. and Ford Motor Co., is working with the United Auto Workers to lower labor costs, including health-care costs. By building small cars in China, Chrysler hopes to be profitable in a small-car segment that often returns meager or no profit margins.

Didn't GM take Chery to court or complain to the Chinese government for copying or stealing a Chevy vehicle? I seem to recall that!

Chery
Chevy

Even their name is copied if you ask me.

[paul3230]

This is bad....very bad.

[VCDJ]

Now can somebody explain to me why should i buy Gm or DCX car that is made outside of U.S. When i can buy Honda or Toyota that is made in US? Why should i support chines economy of mexican?

[Perian]

Originally Posted by VCDJ

Now can somebody explain to me why should i buy Gm or DCX car that is made outside of U.S. When i can buy Honda or Toyota that is made in US?

You bring up a good point.

It's getting harder and harder to explain anything in this business.

[Bravada]

Chery
Chevy

The name "Chery" stems from a typo (sic!) when transliterating the Chinese name of the company ("Quiri") to English, the intended result was "Cheery" (kinda in line with the usual "Peculiar Luck Happy-Go-Lucky Dragon Corp." you can find on the lables of Chinese-made goods), but since the typoed name began to be used the company decided not to change it (it was making the old Seat Toledo sedan under license from VW back then, nothing to do with GM).

Then they started making copies of Daewoo Matiz (called Chery QQ), whose redesigned version is now sold as Chevrolet Spark in many countries, including AFAIK China, and when approached by GM on the legal route, they claimed they have acquired the rights to Daewoo models (they also make a large sedan based off the Daewoo Magnus design under the name "Oriental Son") during the period of hiatus between Daewoo's bankruptcy and GM taking over. I don't know whether they managed to prove it legally or not, but I think there was some out-of-court settlement between GM and Chery and now Chery sells the QQ in quite many export markets, though almost invariably "developing" (think Iran and the like).

[Bravada]

Now can somebody explain to me why should i buy Gm or DCX car that is made outside of U.S. When i can buy Honda or Toyota that is made in US?

I'd say you could adopt a radically unusual approach of buying a good car.

[johnny smallblock]

Originally Posted by VCDJ

Why should i support chines economy of mexican?

I don't know how to respond to that.

Seriously though, if you buy an American-branded car you are contributing to a company that employs more Americans and pays them better, then if you buy a foreign-branded car.

[dufus22]

If this works, i have a feeling that this maybe a new trend.

[throwback]

From a pure business perspective this makes sense. Build an inexpensive car someplace inexpensively, and sell it for a profit everywhere. I don't see how they could build the Hornet in the USA and make money. None of the B-segment cars currently for sale in the USA are made in the USA. No reason why Chrysler should be any different.

[nascarnate326]

My family still only has, American Cars, with an American Brand.
Time to move to England....