Chery, Chrysler May Form China Venture
April 16, 2008

China’s Chery Automobile Co. reportedly is talking to Chrysler about forming a venture in China, and Chrysler will begin selling Chery-built Chryslers in Latin America late this year, a Chery executive said.

“Chrysler wants to deepen our current cooperation,”' Chery spokesman Jin Yibo told Bloomberg News in a phone interview Tuesday. “Our options include setting up a venture.''

Chrysler will begin selling Chery A1 small cars in Latin America in the second half of this year, Jin said. The models will be sold under a Chrysler brand. Chrysler will also sell Chery cars in other markets including Eastern Europe and the U.S.

Chrysler Vice Chairman Thomas LaSorda, who was Chrysler CEO when the automaker signed the original deal for Chery to supply Chrysler with China-built small cars, refused to give details about the venture in a conference call Monday regarding its product swap with Nissan. He would only say: “Our discussions with Chery are proceeding aggressively. “We’ve moved resources there –- our people are [engineers] to work aggressively to ready future platforms.”

He refused to provide timing for introduction of the Chery-built Chryslers. He did say the Chery-based Chryslers will first go on sale in outside of Western Europe and countries covered by the North American Free Trade Agreement (NAFTA), which include the U.S., Canada and Mexico. He said Chrysler has a date in mind an on-sale date for those markets, but he’s not telling. After that, Chrysler will launch the Chery-based vehicle in NAFTA countries and Western Europe.

“We do not have a year for when they will be available in NAFTA markets or Western Europe,” he said, adding much work needed to be done to meet strict safety and environmental regulations.

Chery is the largest maker of own-brand vehicles in China; China’s other largest carmakers build cars with foreign partners.

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