Chery to Reconsider Deal with Chrysler
by: evander
Total views: 80
Word Count: 657
According to reports Chery, the
Chinese auto maker that DaimlerChrysler AG has previously formed a limited
partnership with the intention of building Chrysler-branded cars, wants to
re-examine the deal again in lieu of the sale to Cerberus.
Zhang Li, the general manager
of Chery Automobile Co. Ltd., in an interview with the German financial daily
Handelsblatt said that the company has stopped the project and would like to
renegotiate its agreement on building a compact for Chrysler. This is in
connection with the sale of the money-losing Chrysler Group to a private equity
firm Cerberus Capital Management LP in a $7.41 billion deal.
Zhang said the deal totally
surprised his company and it has not yet talked with Cerberus about the move.
Handelsblatt also quoted Zhang as saying, "We continue to be in talks with
Chrysler, but we don't have any contact with the new owners yet."
Mary Gauthier, spokesperson for
the German-American auto maker in
General Holiefield, the United
Auto Workers’ Chrysler Division Vice-President together with Chrysler and
government officials has regarded the plant as a sign that Cerberus has faith
in the automaker’s turnaround plan.
However Holiefield has
refrained from answering questions whether they the UAW would give Chrysler the
manufacturer of quality Dodge Avenger body kit with the same health care concessions
they have given Ford and GM. He also refused to discuss issues regarding any
effort by Chrysler to negotiate a way out of its estimated $19 billion
long-terms retires health care liability.
Instead of discussing the above
issues he diverted the attention to the construction of the plant which
replaces an outdated factory in
Construction on the new plant
will start next month. Chrysler also said that state-of-the-art axles are
coming off the line sometime in 2010. Chrysler will break ground on a new
engine plant in
It can noted that Chrysler has
previously announced specifically last April that it would spend $1.78 billion
on transmission and engine facilities, which include Marysville and Trenton
plants plus some $300 million paint shop at its assembly plant in Sterling
Heights and a $50 million investment in its Warren stamping and assembly
complex.
The axles that will be produced
at the new plant will also be sold to Mercedes-Benz and will make cars more
fuel efficient explained Frank Ewasyshyn, Chrysler’s Executive Vice-President
of Manufacturing.
But it would not be like any
automakers that are outsourcing parts such as axles; Chrysler wanted to keep
them in-house because it has exclusive technology. These axles are not like
those produced by other automakers Ewasyshyn said that the axles that they will
produce will make cars more efficient since it will reduce friction and heat in
sending power to the wheels.
The new axle plant will replace
the Detroit Axle plant which currently employs more than 1,600 workers. The new
engine plant will also replace the current engine plant at
About the Author
Evander Klum is a Business Administration graduate who hails from Alabama. He enjoys extreme sports and he is also a car racing fanatic. At present, he works as a marketing manager at an advertising agency in Cleveland.
Rating: Not yet rated