Chrysler Group LLC is hoping to catch up with its rivals in China and so it has made a deal to produce Jeeps in China with partner Guangzhou Automobile Group Co Ltd. At the Detroit car show, Jeep CEO Mike Manley said that it’s a big deal for Chrysler to produce the Jeep in China since it’s the only way for the brand to reach its potential in the country.
Jeep CEO Mike Manley told Reuters that China has a “lot of potential” and that to make considerable progress, it has to localize its vehicles in the country. Jeep intends to continue to build vehicles in the U.S. Sergio Marchionne, the CEO of both Chrysler and Fiat, thinks that Jeep is one of about five Fiat and Chrysler brands with worldwide potential. Jeep sales achieved a new record in 2012, with a 19% increase to more than 700,000 vehicles.
Marchionne seeks to offset European losses by raising sales of the Fiat 500 as well as its Jeep, Alfa Romeo, and Maserati models. In the Chinese market, Fiat and Chrysler trail behind other foreign carmakers. Last year, Chinese consumers purchased 19.3 million cars. IHS Global Insight said that both General Motors and Volkswagen sold more than 2.8 million cars in China last year, making up more than 29% of total vehicle sales in China.
In comparison, Jeep, Chrysler and Fiat reported sales of over 60,000 cars in China in 2012. Fiat said that the recently launched Fiat Viaggio sold around 10,000 in its first three months. Fiat said that by 2014, it hopes to increase sales in China to 300,000. Last year, its first plant started operating there. This plant builds the Viaggio sedan on a platform shared with the Alfa Romeo Giulietta and the Dodge Dart.