Tuesday, December 9, 2008
Chrysler News-Chrysler Squashes Chery Deal
The Detroit automaker needs a cheap compact car from China, but it just doesn't have the cash.
Chrysler will not be getting a small, cheap car from China, even though it could use one right now for its turnaround efforts. The Detroit automaker which is in the middle of lobbying for a bailout from Congress, and Chinese car giant Chery Automobile have scrapped plans for a joint venture, as both ailing companies decide that their own survival is more pressing than developing new car models.
The two automakers have broken off negotiations, first disclosed in July 2007, for Chery to produce a low-cost compact car to be sold under the Chrysler's Dodge brand in the United States and Europe. Though Chrysler needs to diversify from heavy pick-ups, midsize vans and jeeps, to small passenger cars, a Chinese-made car would have required financing for marketing, quality control and dealer distribution that Chrysler simply does not have. Chrysler would also have had to ensure the Chinese car met Western emissions and safety standards....More