Fiat, Guangzhou Sign Deal for New Chinese Plant
text size: A- A+
"They've had discussions with Guangzhou Automobile and they're about to set up a factory in China," Sun Yngfu, director-general of European Affairs at China's commerce ministry, was quoted as saying by the aforementioned source. "We're very interested in cooperation in the auto sector," Yngfu said.
An article by business daily Il Sole 24 Ore claims the future joint venture will be split 50-50 between Fiat and Guangzhou. As for the production plans, it seems like the first model to result from the alliance will arrive in China sometime in 2011 but details are yet to be released. However, the two will produce a new version of Fiat Linea plus Fiat's Bravo and Grande Punto models.
As part of the joint venture, Fiat and Guangzhou plan to manufacture around 140,000 cars and 220,000 engines per year. Even though it was initially thought that the two companies would produce cars in Guangzhou's facilities, it is now believed the two companies want to set up a new factory that would become operations by 2011. The joint venture is worth 4.3 billion yuan ($630 million), the two automakers said in a release rolled out in May.
This isn't Fiat's first attempt to establish a joint venture in China as the Italian manufacturer previously hold talks with some other local manufacturers, including Chery Automobile who decided to delay a decision in March.
UP NEXT: Audi's Best Half-Year in China Tip: navigate with ← and →
FIAT cars we've tested
all testdrives →