THE Stellantis and Guangzhou Automobile Group have decided to terminate a joint venture that produces Jeep at Chinaautomakers said on Monday.
The turnaround comes after GAG berated the world’s fourth-largest automaker in January for announcing plans to increase its stake from 50% to 75%, saying the two parties had not yet signed a formal agreement.
“We came to the conclusion that it was best to close the joint venture,” said a spokesperson for Stellantis, adding that the automaker can still operate in China through its dealer network.
The Chinese automaker confirmed in a statement that the two companies were negotiating how to close the business after years of losses.
In its 2030 business plan released in March, Stellantis said it would adopt a “light on assets” business model in China, still with the aim of increasing revenue but through imports instead of domestic production.
“The Jeep brand will continue to strengthen its product offering in China with an enhanced electrified lineup of imported vehicles,” said Stellantis.
Stellantis aims for revenue in China to reach €20 billion by 2030, amounting to 7% of total expected revenue – a jump from €3.9 billion in revenue in China, India and Asia-Pacific in 2021.
The GAG venture, which saw sales down 50% last year, closed a factory in March and ended a joint venture with Dongfeng due to overcapacity.
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Source: Moneytimes
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