Chief Executive Officer Sergio Marchionne is now hoping Chrysler Group LLC’s Jeep brand will rescue a stalled entry into China’s fruitful car market.
Fiat is ready to sign a deal with local partner Guangzhou Automobile to build the Jeep Cherokee sport-utility vehicle in China, three people that have knowledge of the matter said. The SUV could reach showrooms in 2015, said one of the sources, who asked not to be identified because the discussions are private. This would be the third time the Italian group tries to make an entry into what is now the biggest car market globally.
“Marchionne is far too late in China with a volume brand like Fiat,” said Giuliano Noci, vice rector for China at Milan Polytechnic. “Chinese customers are looking for aspirational brands, which Jeep is but Fiat isn’t.”
Fiat is also aiming to fill unused capacity at its only plant in China, aiming to produce the Jeeps here, rather than at a new facility. That is because the Viaggio sedan – the only car currently made at the factory – which was designed specifically for China and is predicted to underachieve the sales targets for this year and 2014 by more than 60 %, according to predictions from IHS Automotive.