Chrysler confirms agreement with China's Chery on cooperation

Chrysler Group President and CEO Tom LaSorda confirmed Thursday that his company had reached an agreement in principle with China's Chery Co. to distribute Chery- made small vehicles in the global markets.

"Being able to partner with Chery represents a long-term solution to the challenges of how to profitably compete in the small vehicle segment," said LaSorda.

"This supply partnership is part of a new business model that is allowing us to introduce all-new products more quickly, with less capital spending. This announcement reflects the realities of a global industry and DaimlerChrysler's need to remain competitive in all segments," he added.

Chrysler Group officials said the Chery-made new vehicles, which will be sold under Chrysler Group brands, will attract new customers in two segments in which the Company does not currently compete: very young buyers and entry-level price-point buyers.

These small, low-price segment vehicles are especially important in more price- and fuel-economy sensitive markets, including Canadian, Mexican and most European markets.

"We already have a well-established relationship with Chery Automobile." added LaSorda. "Chery is the largest third-party customer of the Chrysler Groupz/BMW Group Tritec Engine joint venture in Brazil."

Chery has already adopted some of the most state-of-the art manufacturing processes. The level of technology adopted in their plant rivals that of many western automakers.

Chery is well on its way to becoming a world-class automaker, noted LaSorda, and meeting its goal to be the No. 1 Chinese automaker by 2010.

Source: Xinhua