Daimler accelerates plans for China
BEIJING - DaimlerChrysler AG will start assembling minivans in China next year and intends to start importing "billions" of dollars worth of Chinese parts into North America, says president and CEO Tom LaSorda.
Production of the Chrysler 300C sedan was launched here a few weeks ago in a new plant Chrysler has just built on the outskirts of the national capital with Mercedes and a Chinese government partner.
After testing the waters for several years, DaimlerChrysler is jumping into the Chinese marketplace with both feet, accelerating plans to build a wide range of its products here from locally produced parts.
"We need to move into regional markets where the low-cost supply base is," Mr. LaSorda said.
Chrysler's Chinese minivan "will be the same product we produce today" in three plants in North America and Germany, he said. "But it will be produced in China for China."
The company must expand production and sales outside North America, which accounts for 80 per cent of current operations, he said.
The minivans will be followed by Chinese-built versions of the latest new Jeeps, a "Sebring-sized" sedan that will probably be the Dodge Avenger, and other vehicles, Mr. LaSorda said.
Cars that don't contain about 85 per cent locally sourced parts in China are saddled with a 25-per-cent import duty.
The tax effectively takes those products out of contention in this hyper-competitive marketplace, which soon will be the world's largest and therefore the most influential.
By building cars in China with Chinese parts, Chrysler hopes to triple last year's sales of 25,000 vehicles so it can move out of the fringes of this seven-million-unit-per-year market and into the mainstream.
There is no word yet on which company Chrysler will choose to build the Dodge Hornet, a planned attempt to crack the booming worldwide market for low-cost, entry-level compact cars.
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