After a bombshell report stated multiple Chinese automakers are courting Fiat Chrysler Automobiles in the interests of a buyout, the country’s most well known manufacturer says it wasn’t the one making an offer.
Geely Automotive, an unknown entity until its parent holding company’s 2010 purchase of Ford castoff Volvo Cars, claims it isn’t planning a takeover of the Italian-American automaker. However, it’s not like Geely’s parent company doesn’t have deep pockets. Surely there’s roughly $20 billion in clanky bits somewhere in those trousers.
Still, a source claims Zhejiang Geely Holding Group did hold preliminary talks with FCA late last year.
According to Reuters (via Automotive News Europe), Gui Shengyue, Geely Automobile’s executive director, rejects claims that his company is the “well-known Chinese automaker” cited in the initial report. The offer reportedly wasn’t enough to lead FCA to the altar.
“We don’t have such plan at the moment,” Shengyue told reporters following the report.
Monday’s Automotive News piece names Dongfeng Motor Corp., Great Wall Motor Co., Zhejiang Geely Holding Group, and Guangzhou Automobile Group (FCA’s Chinese joint partner) as being among the interested parties.
While Geely is said to have met with FCA, the same Reuters source claims it has its hands full with other ventures and is no longer interested. Certainly, there’s no shortage of existing ventures to tie up Geely’s manpower and finances — its recently purchased minority stake in Malaysia’s Proton and majority stake in British sports car maker Lotus, its development of the mysterious Lynk & Co brand, and its lucrative Volvo tie-up, to name a few. The Chinese company’s profits more than doubled in the first half of 2017, helped by its ownership of the upmarket Swedish brand (and its clever engineers).
So, if it isn’t Geely standing at the door, flowers in hand, who is it? FCA isn’t talking. Still, if a company does pull off a successful offer, “it could be a fast track for their development,” Shengyue said.
The sharing of knowledge across the Pacific has the potential to benefit both companies, with the American party given greater access to a large and growing market (not to mention cash), and the Chinese party gaining access to new technology. Perhaps the EV-heavy Chinese manufacturing landscape would benefit the notoriously EV-shy FCA as environmental regulators across the globe tighten the noose.
Officially, FCA’s at home in its room after a double rejection from General Motors and Volkswagen earlier this year. The latter would-be suitor, if you recall, wasn’t particularly nice about it.
[Image: Fiat Chrysler Automobiles]
As long as Jeep survives.
Jeeps made in China (eventually made exclusively in China), does that qualify as survival?
Jeep was actually the first non-chinese brand to set up production in China, back in 1983.
Yep. Daimler eventually stripped that asset away for themselves before setting Chrysler adrift.
Jeep hit its zenith 20 years ago: ZJ, XJ, TJ
Most solid lineup they’ve had.
Now? The fact that they have to have a special “trail rated” designation shows how far they’ve fallen.
I remember back when gas prices start plunging 4 years ago a ex colleague who worked for Ford told me that was lot of worry in Dearborn. They were worried that Fiat will crush them in sales because of Jeep and they could spin off more crossover models for Dodge and Chrysler as well. But lucky for them they had Sergio running FCA…
That’s okay, they’ll become hungry to buy again an hour later.
I’m thinking thats the Brampton plant. Maybe its the photo ? I do think its kind of dark for the end of line flat top conveyer. Lots of overhead fans. Such fans can be a blessing, or a pita, depending on your perspective..I see a few dangling plugs.
Nice to see them using protective tape on the lower part of the front fascia.
As far as the topic goes, I just hope that plant can stay open. Regardless of who owns it.
Where else does FCA assemble LX/LY cars?
The sharing of tech may or may not happen. If this sale would require the approval of CFIUS ( Committee on Foreign Investment In the United States) the sharing of tech could be highly constrained. Last year the approval of the sale of a tech company to China came with many stipulations on such things. Notably, in the first few years of ownership the Chinese parent is not allowed access to the firmware source code of the US company’s devices and all communications between the two are funneled through a narrow channel for approval. So, they have very limited sharing of knowledge and products made for the each other are handled as if they are two separate companies contracted to make a product for the other.
FCA is a Italo/Dutch/British company that owns US/Mexican/Canadian plants. Also in Poland, Serbia, Italy and Brazil and some in China. They can sell to whom they want and what is so secret about designing and assembling cars anyway? GM and the rest already have 50/50 deals assembling vehicles in China if you want to talk about any secrets already given away, not because it was a great idea to give half away, but greed like the $bills in Unca Scrooge’s eyes drove them to do it. And to hell with jobs in North America when you can use cheap labor instead.
Now I get to read the usual drivel about China and poor quality cars when those foreign companies are assembling vehicles there and assuring quality and environmental standards in their plants – at least for what they export. Just to be on the safe side.
The Buick Envision is hardly merely Chinese. GM, that good old GM, for which Canada put up fully 20% of the bailout money, has basically left Canada and now will leave the US more and more. Welcome to club of false expectations that any gratitude will be shown for the company’s survival, and lots of Mary Barra double talk. she sure was glib in interviews she gave in Canada recently. Never heard scripted reponses so cleverly delivered.
Let’s Make America Great Again, by asking the Chinese to help out.
It would be brilliant if this rumor was actually started by FCA, as a ploy to get automakers interested in them.
That sounds about right. Sergio is desperate. He would sell his body if he could find a buyer.
Fiat Automobiles is the last real holding of the old Fiat industrial conglomerate, owned by the Agnelli family. They’re trying to pivot to more financial services, insurance, and etc. industries that make way more than the 5-10% margin a well run automotive company runs.
Sergio’s job is to essentially sell Fiat off so that the debt and liabilities of the company go to someone else, and all the profits go to the Agnellis to be invested in more modern industries. Oh, and there’s a nice golden parachute on the side for Sergio.
Note: this is why Ferrari was spun off the way it was. To these folks, Ferrari is way more important than Alfa or Maserati.
Well no, Fiat and VM Motori are not up for sale, only the US interests.
Even if Chrysler/Jeep was the best run company in the world – which is definitely not – Fiat never had the capital depth to run such a large business. In the abscence of a merger, they need to flog it off to raise capital to upgrade the Fiat lines, which they haven’t had the money to do under FCA.
My theory is that its a ruse to get patriotic fools in the US to buy out the business like MB managed to do with Cerberus.
I truly believe all 3 US brands will eventually be bought out by the Chinese, it’s where the real money is.
It’s an interesting question: how do you deal with foreign companies that are partly or totally owned by their local governments trying to buy your (ostensibly free-market) stuff?
Cuz most of these companies have the local town, province, or even the national government as major shareholders and cash sources. (EDIT: see also VW, for a reason why they’ll never truly be punished for smoghazi)
” it’s where the real money is.”
It is until Chinese economy comes crashing down in flames. It will happen eventually.
I Envision that the Chinese will eventually own Buick for their final Encore.