Fiat has reportedly come to terms with its Chinese joint-venture partner to locally produce Chrysler’s all-new Jeep Cherokee compact crossover.
After just a few weeks of negotiations, Fiat has reached an accord with Guangzhou Automobile Group Co. to build the Jeep Cherokee at a new plant in the Panyu district of Guangzhou. Fiat was originally pushing to build the Cherokee at its underutilized plant in Changsha, but backed off that plan after Guangzhou Auto insisted on using the new facility.
The Cherokee is now set to become the first vehicle built at the new Guangzhou factory. Recently approved by the Chinese government, the plant will carry a price tag of $770 million and will initially have the capacity to build 60,000 vehicles annually.
Fiat is banking on local Cherokee production to help the company secure a bigger slice of the Chinese market. Jeep was actually the first foreign auto maker to setup a manufacturing base in China in 1983, but the off-road marque ended production in the country in 2006.
Because Jeep does not produce vehicles in China, its vehicles are subject to heft fees. For example, the Jeep Grand Cherokee typically retails for about $30,000 in the United States, but carries a price tag of $95,000 in China.
Photo by Nat Shirley.
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