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Chinese chasing Jeep

 

For some time now China has had several companies desperate to break into the world market for vehicle sales. After a ropey start with copy-cat vehicles such as Range Rovers and other top brands, one automotive company is going straight for the jugular.

An unnamed Chinese company stepped forward with an offer to buy FCA (Fiat Chrysler Automobiles) but was refused, however, the suitors are still knocking on doors.

Now Chinese automaker Great Wall is interested in making a deal specifically to purchase the Jeep brand.

Great Wall President Wang Fengying told Automotive News in an email that her company is “connecting with FCA” to start the negotiation process. FCA, though, told the publication that it hasn’t been approached by Great Wall. Great Wall’s offer, if accepted, would separate Jeep, FCA’s most valuable brand, from the rest of the FCA stable.2018 Jeep- Grand-Cherokee-Trackhawk

It’s not unthinkable that FCA would consider selling Jeep on its own. FCA CEO Sergio Marchionne has said previously that he’d consider spinning off Jeep and Ram.

The company also stated it could see making Maserati and Alfa Romeo into a separate company too.

Jeep, though, might be worth more on its own that the entirety of FCA with Jeep included, according to Morgan Stanley analysts. This complicates the matter for any potential buyer that owns FCA franchise dealerships, and for FCA, for which Jeep is an attractor for selling the company as a whole.

Great Wall, which only generates $14.7 billion in annual revenue (compared to FCA’s $131 billion), is confident it could raise the funds to buy Jeep. As Automotive News points out, though, there could be a bidding war brewing if Jeep can be bought separately from the rest of the brands.
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Still, As Great Wall spokesman Xu Hui said, the company has been following Jeep, and sees it as a key to achieving its goal of becoming “the world’s largest SUV maker.” Great Wall already has research and development facilities in Detroit and Los Angeles. The Chinese company is also considering building a factory in the U.S.

Jeep is currently expanding its market presence, and has new vehicles on the way for 2019, those being the Wagoneer and Grand Wagoneer.

 

We wait and see …

 

 

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