Jeep Production May Return to China
Executives Confirm 'Detailed Conversations' with Chinese Partner
Those of you with a sharp memory may remember that Jeep Cherokees were built in China starting in 1985. Since then, Jeep has gone through four corporate owners and production was ultimately phased out at the Beijing Jeep plant in favor of Mercedes-Benz E-Class sedans when the company was under Daimler management. However, local production of Jeeps for the Chinese market looks poised to begin anew under new owner Fiat, according to a Bloomberg report.
Mike Manley, president of the Jeep brand, said that the company is in "very detailed conversations" with Fiat's Chinese partner Guangzhou Automotive Group about bringing Jeep production back to China. We reported on the likely collaboration with Guangzhou Automotive in May. The intense focus on the Chinese market is driven by two key factors, namely weak demand in Europe and the high tariff on imported vehicles in China, which causes some models to sell for more than triple what they do in the U.S.
The main question facing Jeep in terms of its strategy in China is whether to build all of its models in China for local consumption or focus on just its best-selling models. The brand is targeting 500,000 sales outside of North America by 2014 and three out of four Chrysler models currently sold overseas are Jeeps.