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    William Maley

    Rumorpile: Chinese Automakers Are Interested In FCA

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      It seems there are some possible suitors for Fiat Chrysler Automobiles

    It is no secret that Sergio Marchionne has been looking for a buyer to take on Fiat Chrysler Automobiles for the past two years. But no one seemed seriously interested.

    That has changed.

    Automotive News has learned from various sources that a number of Chinese automakers are conducting appraisals into FCA, with some meeting with representatives of U.S. retail groups about a potential acquisition last week. One source revealed that FCA executives have traveled to China to meet with Great Wall Motor Co. and that Chinese delegations were at FCA's HQ. AN also reports that a well-known Chinese automaker has put forth an offer this month for the company, but was turned down as it wasn't enough money to do a sale.

    It is unclear which Chinese automakers are looking at FCA. Aside from Great Wall, sources say Dongfeng Motor Corp., Zhejiang Geely Holding Group, and Guangzhou Automobile Group (FCA's joint venture partner in China) are interested. Unsurprisingly, FCA and the Chinese automakers are keeping their mouths shut.

    Why are Chinese automakers suddenly interested in FCA? Part of it comes from the government putting pressure on companies to expand beyond China. A government directive called China Outbound is pushing Chinese companies "to acquire international assets from their industries and operate them "to make their mark."

    "Right now, Chinese automakers enjoy the full support of the leadership in Beijing to go and make it happen. That's something brand new, and it's really picked up since 2015,"  said Michael Dunne, president of Dunne Automotive based in Hong Kong.

    A key example is Geely acquiring Volvo back in 2010.

    Also, FCA provides Chinese Automakers wanting to enter the U.S. something akin to a turnkey operation. FCA has about 2,600 dealers in the U.S., along with extensive networks in Canada and Mexico. Worldwide, FCA has 162 manufacturing operations and 87 research and development centers - something that would appeal to Chinese Automakers.

    So if a deal was worked out, what would a Chinese Automaker be getting? According to a source, the sale would include Jeep and Ram Trucks - FCA's profit makers, along with Chrysler, Dodge, and Fiat. Alfa Romeo and Maserati would be spun off to maximize returns for Exor - holding company controlled by Agnelli family which holds a controlling interest in FCA.

    Source: Automotive News (Subscription Required)

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    On 8/14/2017 at 8:45 PM, ocnblu said:

    If this happens... another nail in America's industrial coffin.  And we have ourselves to blame.  No one else.

    Quoted for truth!

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    8 hours ago, Drew Dowdell said:

    The strangest possible part of the whole deal is that Jeep alone is supposed to be valued more than all 4 brands combined.... which means that investors see Chrysler, Dodge, and possibly Ram as negative value. 

    Whatever company buys them is not going to be able to ax the other brands and rebuild the new network, but they will have to fill those brands with new product.  Sadly, at this point, any leadership would be better than the leadership FCA currently has. China may be Dodge and Chrysler's only hope.

    If one needs an example of it actually working out well, all one needs to do is look at Volvo.  This is why I was surprised by Geely saying they weren't interested in FCA at this time. A brand lineup of Volvo at the top, Chrysler as mid-premium like Buick, Dodge as the family car, Ram, and Jeep could actually work.  Volvo has a fantastic, flexible new platform (One of the best on the market at the moment IMHO) in SPA that could conceivably be used for Chrysler, Dodge, and Jeep.  Chrysler could go to China as a Buick competitor, Jeep is already there, ProMasters and City could be rebadged into Geely or Jeep for China.  When you start looking across the lineups, picturing the replacements using SPA and filling in some of the current gaps, a Geely - Chrysler Group merger actually makes sense. 

    True...I think Geely might be one that could work. I have to say I like what they have done with volvo....And the plan you mention would be a fine one.

     

    Now as far a axing the brands, you have like 4 cars between two brands....pretty sure anyone could fill the gap......

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    9 hours ago, Drew Dowdell said:

    The strangest possible part of the whole deal is that Jeep alone is supposed to be valued more than all 4 brands combined.... which means that investors see Chrysler, Dodge, and possibly Ram as negative value. 

    Whatever company buys them is not going to be able to ax the other brands and rebuild the new network, but they will have to fill those brands with new product.  Sadly, at this point, any leadership would be better than the leadership FCA currently has. China may be Dodge and Chrysler's only hope.

    If one needs an example of it actually working out well, all one needs to do is look at Volvo.  This is why I was surprised by Geely saying they weren't interested in FCA at this time. A brand lineup of Volvo at the top, Chrysler as mid-premium like Buick, Dodge as the family car, Ram, and Jeep could actually work.  Volvo has a fantastic, flexible new platform (One of the best on the market at the moment IMHO) in SPA that could conceivably be used for Chrysler, Dodge, and Jeep.  Chrysler could go to China as a Buick competitor, Jeep is already there, ProMasters and City could be rebadged into Geely or Jeep for China.  When you start looking across the lineups, picturing the replacements using SPA and filling in some of the current gaps, a Geely - Chrysler Group merger actually makes sense. 

     

    1 hour ago, daves87rs said:

    True...I think Geely might be one that could work. I have to say I like what they have done with volvo....And the plan you mention would be a fine one.

     

    Now as far a axing the brands, you have like 4 cars between two brands....pretty sure anyone could fill the gap......

    I think no one will really know who in China if anyone is really going to buy FCA US. If it happens it will surprise everyone.

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    1 hour ago, daves87rs said:

    True...I think Geely might be one that could work. I have to say I like what they have done with volvo....And the plan you mention would be a fine one.

     

    Now as far a axing the brands, you have like 4 cars between two brands....pretty sure anyone could fill the gap......

    True, but one has to remember to think globally. Dodge never had much of a market outside of North America.  

    Chrysler has been in Europe, they sell an oddly high number of Town and Country minivans there. It's just about the most common North American built, US branded vehicle I see there. Jeep is in China, neither Chrysler nor Dodge are. They could, and already have plans to send Chrysler to China starting next year.  Chrysler will be priced and positioned like Buick. Under Geely, they'd keep the Pacifica. 300 and 200 go on SPA as Lacrosse and Regal competitors. Add a crossover or 3 and the lineup is pretty full for both China and US. SPA was designed from the start to be a plug-in hybrid, so it would go over well with China's electric car goals.

    No need to bring Dodge as a brand over to China, Geely is already an established brand, so just swap badges on which ever cars get shipped whichever direction. Dodge US could use some lower cost platform shared with Geely for the smaller stuff and the Volvo SPA for the Durango. Charger and Challenger would get axed under this scenario. Replacements for Dart, Avenger, Journey, and Nitro (FWD) could come from Geely.  This also gets Geely into the South America market via a reputable brand.

    RAM and Jeep just keep on keepin on. JGC would probably need to move to SPA, just let the Americans make it trail rated. They'd eventually have to replace the Fiat based Jeeps, but they'd have 5 or 6 years to get that done. 

    It's not impossible to imagine Volvo's new factory spitting out S90s, 300c, Durango and JGCs.

    *Sorry if I'm rambling, hardly slept this week*

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    49 minutes ago, Drew Dowdell said:

    True, but one has to remember to think globally. Dodge never had much of a market outside of North America.  

    Chrysler has been in Europe, they sell an oddly high number of Town and Country minivans there. It's just about the most common North American built, US branded vehicle I see there. Jeep is in China, neither Chrysler nor Dodge are. They could, and already have plans to send Chrysler to China starting next year.  Chrysler will be priced and positioned like Buick. Under Geely, they'd keep the Pacifica. 300 and 200 go on SPA as Lacrosse and Regal competitors. Add a crossover or 3 and the lineup is pretty full for both China and US. SPA was designed from the start to be a plug-in hybrid, so it would go over well with China's electric car goals.

    No need to bring Dodge as a brand over to China, Geely is already an established brand, so just swap badges on which ever cars get shipped whichever direction. Dodge US could use some lower cost platform shared with Geely for the smaller stuff and the Volvo SPA for the Durango. Charger and Challenger would get axed under this scenario. Replacements for Dart, Avenger, Journey, and Nitro (FWD) could come from Geely.  This also gets Geely into the South America market via a reputable brand.

    RAM and Jeep just keep on keepin on. JGC would probably need to move to SPA, just let the Americans make it trail rated. They'd eventually have to replace the Fiat based Jeeps, but they'd have 5 or 6 years to get that done. 

    It's not impossible to imagine Volvo's new factory spitting out S90s, 300c, Durango and JGCs.

    *Sorry if I'm rambling, hardly slept this week*

     

    Nope, makes perfect sense to me. If it goes Geely, I like this.......

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    1 hour ago, dfelt said:

     

    I think no one will really know who in China if anyone is really going to buy FCA US. If it happens it will surprise everyone.

    True....it's all up in the air right now....

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