Stellantis has terminated the joint venture that produced its Jeep SUVs in China after failing to acquire a majority stake, the automaker said in a statement on Monday.
Due to the lack of progress on the previously announced plan for Stellantis to acquire a majority stake in the GAC-Stellantis joint venture, Stellantis NV today announced its intention to focus on the distribution of imported vehicles for the Jeep® brand in China.” the group.
Stellantis wanted to increase its stake in China Guangzhou Automobile Group (GAC) from 50% to 75%, a move made possible by a new regulatory framework that allows additional foreign investment, subject to Chinese government approval. Important clarification: This ruling is “not linked” to a Chinese government decision, according to Stellantis.
This acquisition, which was to be the “key first step toward streamlining operations” in the world’s largest automotive market. GAC had then protested against the announcement of an agreement not yet signed.
Entry point to China
Jeep, which is becoming electrified, was to be one of the main development paths in China for the 14-brand group, which is targeting a turnover of 20 billion there by 2030.
Stellantis produces and sells, in particular, Peugeot and Citroën in China, as part of another joint venture with the manufacturer Dongfeng. It is also an essential market for its luxury brand Maserati, and a field of conquest for its premium brand DS.
Jeep sold just 20,000 vehicles there in 2021: GAC-Stellantis had concentrated production in a single plant by the end of the year, down from two earlier. The SUV brand will now offer “an enhanced range of imported electric vehicles” in China.
As a result, Stellantis will recognize a non-cash impairment charge of approximately €297 million in its first half 2022 results, which it is due to report on July 28.
Source: BFM TV
