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September 9, 2021

Jeep To Close Factory In China

Jeep will close one of its two factories in China by next March, this as Jeep’s parent company Stellantis aims to restructure its operations in the world’s biggest auto market.

The joint venture with China’s GAC Motor which has the capacity to make 328,000 vehicles a year, sold only 12,288 in the first seven months of 2021.

This will lead Jeep to consolidate its production from Guangzhou to Changsha to “increase the utilization rate of plants and lower cost,” GAC Motor confirmed in a statement.

Meanwhile, the Jeep-GAC Changsha factory has capacity to make 164,000 vehicles a year.

The joint venture was launched by GAC and Fiat Chrysler, which merged with PSA to become Stellantis.

For Jeep Philippines, China is the source of its Renegade (pictured at top) and Compass SUVs.

Besides the GAC partnership, Stellantis operates a joint venture in China with Dongfeng Motor Group, which sold 47,788 cars between January and July.

It earlier closed two plants to tackle overcapacity.

Stellantis said the company was studying a new China strategy, which will be in place by the end of the year. It plans to introduce its Opel brand in China, offering fully electric vehicles.

As competition heats up in China, where more than 25 million vehicles were sold last year, several joint ventures between international automakers and local partners cut operations due to declining sales or consolidations.

Mazda Motor ended its joint venture with FAW last month (opting to enter into a three-way venture with Changan instead), and Hyundai Motor's tie-up with BAIC has sold one factory to electric vehicle maker Li Auto. Last year, Renault shut its venture with Dongfeng less than five years after they started production. In 2018, Suzuki Motor exited its only Chinese joint venture with Changan.

1 comment:

  1. And then the Future stocks of Renegade and Compass will be sourced from India instead.


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