Chrysler Launches Pitch to Expand Outside US

Posted 05 January 2007 @ 09:22 am EET     Print     Reprint     E-Mail     Comments

DETROIT (AP) - DaimlerChrysler AG, hoping to expand outside the tough US market, has announced plans to build an all-new sedan in Beijing and to export a Taiwan-built cargo van to Mexico.

Chrysler Group chief executive Tom LaSorda said the plans formed part of a strategy aimed at doubling the company's sales outside of its North America base, where it is struggling in the face of an onslaught by Asian rivals.

Chrysler Group, the US arm of the German-US auto giant DaimlerChrysler, said US sales of its Chrysler, Jeep and Dodge models skidded seven percent to 2.143 million vehicles last year.

But total sales outside the United States rose by 6.6 percent to 555,924 units, and European sales were up 20 percent at 110,559 cars. Sales were aided by the worldwide appeal of new products such as the fuel-efficient Dodge Caliber and Jeep Compass, which are among the few vehicles built in the United States that are now exported successfully.

"When you look at the global nature of the competitive scene, international initiatives will be critical to Chrysler Group's success in the years ahead," LaSorda told reporters on a conference call on Thursday.

"The opportunities outside the US are becoming more and more important," he said. "We have a solid plan for sustainable, profitable international growth and the results so far provide a clear sign that the strategy is working.

"In the next five-year period, a plan to double where we are today outside North America would be reasonable." LaSorda said the Chrysler Group had signed a memorandum of understanding with Taiwan's China Motor Corp. (CMC) to export a cargo van to Mexico.

CMC will produce the van at its assembly facility in Yangmei, Taiwan and it will be shipped to Mexico where it will be sold as a Dodge vehicle. And production of the new Sebring saloon car for the China market will begin later this year at Beijing-Benz DaimlerChrysler Automotive Co., a joint venture between the Beijing Automotive Industry Holding Co. Ltd. and DaimlerChrysler.

DaimlerChrysler is investing 1.2 billion euros (1.6 billion dollars) in China to make passenger cars, vans and heavy and medium-duty trucks as part of plans to capture a greater piece of the action in the fast-growing market.

In a separate deal announced last week, Chrysler is tying up with China's Chery Automotive Co. to build small cars in China that will be sold in the United States and around the world.

Earlier Thursday, the Shanghai Securities News reported that DaimlerChrysler has won approval to set up a joint venture that will manufacture Mercedes-Benz vans in China.

The US-German group will join forceaas with Fujian Auto Industry Group and Taiwan's CMC to invest more than 200 million euros (265 million dollars) between them. The joint venture, which expects eventually to have annual output of up to 40,000 of DaimlerChrysler's Viano, Viato and Sprinter vans, is scheduled to start production by the end of 2008.