FCA Joint Venture to Produce Localized Chrysler Vehicle in China

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Fiat Chrysler Automobiles and Guangzhou Automobile Industry Group Co. have agreed to bring a localized Chrysler product to China, adding it to the country’s existing Fiat brand offering.

“China is a market of strategic importance to FCA in the next five years,” says John Kett, general manager of Fiat Chrysler in the Asia Pacific region.

The preliminary agreement builds upon the Guangzhou/FCA joint venture’s plans to implement localized production of three new Jeep models in China by the end of 2016. By 2018, the Jeep brand will have one of the most complete SUV portfolios in China, Kett says.

While the Changsha-based industrial operations will continue to retain responsibility for all Guangzhou/FCA manufacturing activities including assembly, quality, product engineering, and supply chain management, a joint commercial operation will be established to oversee all sales, marketing, product planning, and aftersales development of Jeep, Fiat, and Chrysler brands.

Both operations will provide support and management in working toward the launch of the approved product plan, including the introduction of a second vehicle plant in Guangzhou.

Guangzhou/FCA will also begin laying the foundation for the network expansion required to support the development of Jeep SUVs and Fiat and Chrysler passenger cars.

The best-performing dealers from the two existing networks in China will form the basis of both the Jeep SUV network and the Fiat /Chrysler passenger car network. Further, investors will be required to support the doubling of both networks by 2018.

“Collectively the import brands of Chrysler, Jeep, and Dodge, in addition to the localized brands of Fiat, have the group ranked as the fastest growing brands in China,” Kett says. “This plan will accelerate our volume and market share growth at significant speed, and will enable us to deliver the commitment that we laid out on this year’s FCA investor day by growing our (annual) sales volume in China to 760,000 units by 2018.”

The Guangzhou/FCA joint venture, which will have access to the Fiat and Chrysler brand products announced during the FCA May 2014 Investor Day, will release product announcements at a future date.

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