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Fiat-Chery Joint Venture Delayed

Fiat's plans to make itself more visible on the growing Chinese market sustained a minor setback as partner Chery decision to postpone the joint venture, due to the market conditions, as chairman Yin Tongyao said, according to Autonews.

"Foreign automakers are affected by the financial crisis and any additional investment will be difficult for them at a time like this. We have slowed down the JV project with Fiat and production will not start this year as previously planned, but we have not shelved the project," he said.

According to the partnership deal agreed between the two parties, production of Alfa Romeo and Fiat vehicles was scheduled to begin in China later this year. For now, Fiat models, such as the Linea or Grande Punto are available in China only through imports.

Chery's decision might not stop Fiat's worldwide expansion plans. We already know of the Italian's proposed alliance with Chrysler and the rumored merger with PSA Peugeot Citroen. As for China, there are so many manufacturers there to choose from that Fiat doesn't need to look long.

The Italian manufacturer has already approached Changan Auto (for the production of Fiat Sedici) and Guangzhou Auto (to develop a new brand on a Alfa Romeo platform). The latter has already bought the technologies of Fiat's Alfa Romeo model, including its platform and powertrain system, reported.

As for Chery, the company has other dreams to chase. The company admitted it is interested into acquiring Volvo, but only if it doesn't have to fight other Chinese companies to get it. "We may consider a takeover if no one- no other Chinese automakers- are interested. We won't fight for it," the chairman said at the same event.


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