Facing declining sales and a glut of large sedans and SUV's, DaimlerChrysler may look to China for small fuel-efficient cars to sell in the United States. The front runner to provide the cars is none other than China's Chery Automobile Co. Ltd., according to a report in German magazine Der Spiegel.
The move to tap an Asian manufacturer to fill in the product line at the bottom is not unusual. The Big Three have been relying upon Japanese and more recently Korean car makers to fill that role for about 30 years. GM regularly tapped Isuzu, Suzuki and Toyota for such recognizable models as the Geo Metro, Prizm and Tracker. Currently, GM has tapped Korea's Daewoo to make Chevy's entry-level model the Aveo, a fuel-concious model that's been a sleeper success thanks to high gas prices. In the past, Chrysler tapped Mitsubishi for such models as the Dodge Colt, Eagle Talon and Plymouth Laser.
However, outsourcing production of a small car makes little sense this time around because DaimlerChrysler already has a line of small cars Americans are not familiar with: Smart. Rather than introducing the Smart nameplate, simply rebadge a Smart car as a Dodge for U.S. consumption. Rival GM has a similar strategy albeit not as small. Rather than recycling Chevy's or Pontiac's to fill the Saturn line-up, GM is simply rebadging Opals as Saturns starting with the Sky roadster and Aura mid-size sedan.
In addition, Chery already has ambitious — but oft delayed — plans to enter the U.S. market on its own, so making a deal with DaimlerChrysler seems a little surprising. Of course, while the Chinese may have an agreement with automotive entrepreneur
Malcolm Bricklin to bring its sedans to the U.S. market, his constant delays, which are associated with difficulty franchising dealerships, could explain Chery's interest in a deal with DaimlerChrysler. In addition, Bricklin is looking to introduce Chery as a premium marquee rather than a discount brand, so a deal to sell low-end models under the Dodge marquee wouldn't necessarily undermine Bricklin's efforts. Bricklin is best known for bringing Japan's Subaru to the
U.S. in the 1960s and later importing the Yugo in the 1980s, so he's batting 1-1 perhaps adding to Chery's interest in working with DaimlerChrysler. —Matthew Wurtzel
See story from the International Herald Tribune
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See related story about Chrysler's inventory troubles at Auto Week
See earlier post about Chinese car makers
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