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Jeep Planning Major China Invasion

Most of the world's biggest automakers want a piece of the action in China, which has become the world's largest automotive market.. The ranks of the wealthy are growing quickly, and they have a thirst for Western vehicles, and often those from the higher end of the range. Along with premium autos, this market also seems to crave SUVs. Sales of SUVs in China are expected to outpace overall industry sales.

Last week, Chrysler partnered with China's Guangzhou Automobile Group Co. (GAC); agreeing to build three Jeep SUVs there. This agreement followed two years of discussions. Jeep is now Chrysler's main international brand, and the SUV is the perfect fit for growing global markets such as China. The country is Jeep's largest market outside of the United States. This new plan includes the capacity to build 6 million cars a year.

Jeep isn't alone. General Motors, Ford, Mercedes and Volkswagen all have plans to sell SUVs or crossovers in China, exhibiting them at last week's Beijing International Automobile Exhibition. Analysts say that the SUV segment is growing faster than the passenger vehicle market in China, experiencing double digit growth.

Jeep plans to begin production in China before the end of 2015. Three models will be built there, and sold to Chinese customers. Chrsyler hasn't named the specific models, but it's assumed that the Jeep Cherokee and the subcompact Renegade will be among them. The Renegade was styled with the Chinese consumer in mind. Many automakers are designing SUVs and crossovers, with the tastes of Chinese consumers considered.

Jeep will be aggressively seeking to boost it's market share in China, which currently sits at only 1 percent. "We are still a relatively small player in China", said a Jeep spokesperson. "The most important thing now is to get our Jeeps into production". The company is also planning to expand it's Chinese dealership network, growing from 200 to 240 dealers by the end of 2014.

Jeep name recognition in China is high. The company produced Jeeps there in the 1980s, the first foreign automaker to build cars in that country. Jeeps are currently available to the Chinese, but only as imports and subject to high tariffs. Even so, 60,000 Jeeps were imported by the Chinese last year.

By Linda Aylesworth - autoExpert.ca

 

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