European automaker Sterantis has announced that its joint venture (JV) in China is filing for bankruptcy after years of sluggish car sales.
The joint venture that sold the Jeep Cherokee SUV and the Jeep Compass crossover SUV in China saw a significant drop in sales over the past year.
In 2021, sales will drop by 50% to around 20,400 units. 2022 sees a further drop in sales, with less than 2,000 vehicles sold. In May he had only one sale.
The company ended its joint venture with Guangzhou Automobile in July. This comes just months after announcing plans to increase his stake in the partnership from 50% to 75%.
Stellantis CEO Carlos Tavares has accused Chinese partners of not wanting to comply with the memorandum of understanding signed by the two companies.
Instead, Guangzhou Automobile “preferred to violate rather than execute,” Tavares said at the time, according to Reuters. He also pointed out that the “political clout” of doing business in China is growing by the day.
China pulls out, unfair treatment of automakers
Speaking at the Paris Motor Show on Oct. 17, Tavares said Stellantis is considering pulling out of China entirely given rising geopolitical tensions around the world. .
According to French public radio station RFI, Stellantis will stick to such a strategy because the company is already selling Jeep and Alfa Romeo made outside of China “very profitably” in China. If so, we may not need factories in China, Tavares said. .
The Stellantis CEO also complained that while Europe is rolling out a “red carpet” for Chinese manufacturers, the same treatment is not being applied to European manufacturers in China. . Tavares advocates taxing cars imported from China in the same way that Western cars are taxed in China.
in an interview with bloombergRenault Group design director Lawrence van den Acker called the situation “unsettling”.
“I am rooting for Europe. Acker said.
Some European countries have taken steps to protect their domestic industries. France, for example, is preparing measures to provide subsidies for electric vehicles manufactured exclusively in France or elsewhere in Europe.
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Naveen Athrappully is a news reporter covering business and world events for The Epoch Times.