GAC seeks Fiat Chrysler help to enter U.S.
Guangzhou Automobile Group Co., whose partnership with Fiat Chrysler Automobiles NV enables FCA to manufacture in China, wants FCA to return the favor by helping it enter the United States, a top executive told Reuters.
Chinese brands have yet to find much success abroad, generally selling small volumes in developing markets that are highly price competitive.
China exported 728,200 mostly home-brand vehicles last year, a decline of 20 percent as automakers struggled with instability in markets such as Russia and the Middle East, as well as with currency fluctuation, according to the China Association of Automobile Manufacturers.
Guangzhou Auto's subsidiary GAC Motor declared intentions in 2015 to reach the U.S. by next year, where it would become the first Chinese passenger car brand sold to American consumers.
"Chrysler's development in China required our support. Now for GAC Motor's development in the U.S. we also hope for Chrysler's support and help," GAC Motor General Manager Wu Song said this week on the sidelines of the Beijing auto show.
Wu and representatives of GAC Motor did not elaborate on what type of support FCA might offer. An FCA spokesman declined to comment.
Foreign carmakers in China are required to form joint ventures with local companies if they want to manufacture domestically and thereby avoid hefty import taxes.
Guangzhou Auto was the sixth-largest automaker in China by sales volume last year, including vehicles produced through joint ventures with FCA, Toyota Motor Corp., Honda Motor Co. and Mitsubishi Motors Corp.
Extending cooperation beyond China is uncharted territory, though General Motors and China's largest automaker, SAIC Motor Corp., plan to begin joint production in Indonesia next year.
GAC Motor is in talks with potential dealership partners in the United States and has yet to begin road tests -- the two biggest steps it must take to start sales. Wu said the automaker is already doing tests in China on two of its car models to meet U.S. standards. Next year, GAC will also take part in the Detroit auto show, Bloomberg reported. The company has said it wants to sell one million cars annually by 2020, with most of those deliveries in China.
China's auto market is slowing and price competition is rising, but Wu said GAC Motor will keep its primary focus on the mainland rather than overseas expansion.
"Sudden price cuts have messed up the whole [Chinese] market, so at this time we have to invest a lot of energy determining the brand's next strategic steps to protect our position," he said. "We must not be distracted."
China exported 728,200 mostly home-brand vehicles last year, a decline of 20 percent as automakers struggled with instability in markets such as Russia and the Middle East, as well as with currency fluctuation, according to the China Association of Automobile Manufacturers.
Guangzhou Auto's subsidiary GAC Motor declared intentions in 2015 to reach the U.S. by next year, where it would become the first Chinese passenger car brand sold to American consumers.
"Chrysler's development in China required our support. Now for GAC Motor's development in the U.S. we also hope for Chrysler's support and help," GAC Motor General Manager Wu Song said this week on the sidelines of the Beijing auto show.
Wu and representatives of GAC Motor did not elaborate on what type of support FCA might offer. An FCA spokesman declined to comment.
Foreign carmakers in China are required to form joint ventures with local companies if they want to manufacture domestically and thereby avoid hefty import taxes.
Guangzhou Auto was the sixth-largest automaker in China by sales volume last year, including vehicles produced through joint ventures with FCA, Toyota Motor Corp., Honda Motor Co. and Mitsubishi Motors Corp.
Extending cooperation beyond China is uncharted territory, though General Motors and China's largest automaker, SAIC Motor Corp., plan to begin joint production in Indonesia next year.
GAC Motor is in talks with potential dealership partners in the United States and has yet to begin road tests -- the two biggest steps it must take to start sales. Wu said the automaker is already doing tests in China on two of its car models to meet U.S. standards. Next year, GAC will also take part in the Detroit auto show, Bloomberg reported. The company has said it wants to sell one million cars annually by 2020, with most of those deliveries in China.
China's auto market is slowing and price competition is rising, but Wu said GAC Motor will keep its primary focus on the mainland rather than overseas expansion.
"Sudden price cuts have messed up the whole [Chinese] market, so at this time we have to invest a lot of energy determining the brand's next strategic steps to protect our position," he said. "We must not be distracted."
