Chrysler Group unveils China strategy

Just two weeks after starting his new role as Chrysler Group president and CEO, Tom LaSorda reviewed the company's plans in China and Taiwan this week and unveiled three product programs representing an investment of $350 million. The Chrysler Group intends to produce Minivans in Taipei and Fuzhou, and the Chrysler 300C in Beijing, all for local markets.

When combined with recently announced projects of DaimlerChrysler, the investment from the company and its partner for the region now totals $1.5 billion.

"Without a doubt, the automotive industry's greatest potential for growth in the next 10 years is in Northeast Asia," said Dr. Ruediger Grube, Member of the Board of DaimlerChrysler AG, responsible for Corporate Development and China Operations.

"And DaimlerChrysler intends to be there with a major presence. The Chrysler Group's plan to add minivan and Chrysler 300C production to the region further complements DaimlerChrysler's overall strategy to expand production and sales of passenger cars and commercial vehicles, as well as vehicle financing."

LaSorda started his Northeast Asia trip on September 14 in Taiwan, reviewing the company's previously announced plans to license minivan production with China Motor Corp. (CMC), and create a joint venture between DaimlerChrysler Taiwan and CMC to manage sales and distribution of Chrysler Group vehicles, both for the local market.

The following day in Fuzhou, on mainland China's southeast coast, he announced the company's intention to license Southeast Motors (SEM) to produce Chrysler minivans for the mainland Chinese market. SEM is joint venture between CMC and Fujian Motor Industry Group (FJMG). DaimlerChrysler has established a separate joint venture called DaimlerChrysler Vans (China) Ltd. (DCVC) with both FJMG and CMC to produce Mercedes-Benz Sprinter and Viano Multi-Purpose Vehicles at a new facility, also in Fuzhou. Chrysler minivan production will take place at SEM's existing facility.

During the final stop of his trip in Beijing on September 16, LaSorda announced the intention to build the Chrysler 300C at the new joint venture, BeijingBenz-DaimlerChrysler Automotive Ltd. (BBDCA), for the Chinese market.

BBDCA has been operational since its business license was issued last month. The 50:50 joint venture between DaimlerChrysler and BAIC is an expansion of Beijing Jeep Corp., which produces and sells Jeep and Mitsubishi SUVs. BBDCA will also produce Mercedes-Benz E- and C-Class sedans at a new facility in the Beijing Development Area in the southeast part of the city. The former BJC will relocate from its current site downtown to a new facility adjacent to the new Mercedes-Benz production hall. The Chrysler 300C will be built in a new Chrysler production hall, starting in late 2006 at the new location.