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Chrysler: Chery exports not ready for US
2008-04-20
Chrysler LLC's talks on a possible joint venture with China's Chery Automobile Co. are progressing but a China-made car being produced by the alliance is not ready for the U.S. market, Chrysler executives said Sunday. Chery is among several potential partners Chrysler is considering as it prepares to ramp up local production with the aim of joining the ranks of China's top 10 automakers, said Phil Murtaugh, chief executive of Chrysler's Asia operations. "We have no progress to report, but we really are satisfied with those discussions," Murtaugh told reporters at the Beijing auto show. Chery and Chrysler made a "strategic cooperation agreement" last year to produce a low-cost vehicle to be sold under Chrysler's Dodge brand in the United States and other markets. "I think the discussions are progressing well. That's all I can say about it," said Murtaugh. Murtaugh is a former longtime General Motors Corp. executive who was credited with establishing GM's leading presence in China. He joined Chrysler last year after a stint at Shanghai Automotive Industries Corp., one of GM's Chinese partners. Murtaugh and Mike Manley, Chrysler Group's vice president for international sales and dealer operations, said the car being developed with Chery is not ready for sale in the United States. "Neither Chrysler nor Chery is comfortable that those products as they exist today meet the requirements of Chrysler, and we're working together to make changes that we're both happy with," Murtaugh said. "I don't think we're too far away, but neither one of us are ready to say 'Let's go' yet," he added. "We're working on making sure the product's right." Chery Chairman Yin Tongyao, speaking at a separate event, was cautious about his aspirations to begin U.S. sales after years of pledging to break into the North American market. North America and Europe are "very mature markets," Yin said. "We can't get into those markets too quickly, so we should explore those markets in a gradual manner and do it step-by-step. We should not aim too high." The executives said Chery compacts must meet not only regulatory standards but requirements set by the companies themselves in order to meet customer expectations. "Safety is a huge challenge because of the size of the car," Murtaugh said. "There are some challenges. They are not huge changes but they are technical challenges in certain parts of the car."
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