The Changsha court has finally declared bankruptcy The Gac-Fiat Chrysler Automobiles joint company, thus closing the final chapter of Stellantis in the Asian giant. The news was already expected since 2022 when the group came into liquidation. After debts equivalent to more than 1.1 billion dollars and five failed public auctions, the dream of conquering the largest world car market ends in failure.
The end of a 15 -year adventure. The Joint Venture GAC-FCA was born in 2011 With huge ambitions: 17,000 million investment yuan, two production and capacity plants for 300,000 vehicles per year. Under the baton of Sergio Marchionne, the project intended to bring brands such as Jeep and Fiat to the Chinese market with models adapted to local needs and trends, including the Jeep Renegade, Compass and Cherokee, in addition to the Fiat Viaggio and Ottimo.
Free fall after initial success. After reaching its peak in 2017 With more than 200,000 units soldGac-FCA experienced an unstoppable descent. Sales collapsed to 124,780 units in 2018, continued to fall in 2019 and reduced just 20,396 units in 2021. Insufficient numbers for a market of more than 25 million vehicles per year and a muscle like Gac-FCA.
The problem of combustion engines in China. While the Chinese market turned to electric vehicles and plug-in hybrids, Gac-FCA remained faithful to combustion engines. This strategy is over resulting fatal In a country where new technologies and electrification have become the norm. And it is that Chinese consumers have been opting for the electricity in an environment of high competitiveness between automobile manufacturers.
The failed attempt to save yourself. In 2022, Carlos Tavares tried to recover control increasing Stellantis’s participation From 50% to 75%, but GAC publicly rejected the maneuver. The joint company entered into a restructuring process and, subsequently, in liquidation. Five public auctions to sell land, equipment and the two factories were deserted, something common in China where it is more profitable to build from zero electric vehicles.
Historical symbolism. Stellantis withdrawal marks the end of a historic era. Jeep was the first foreign brand to make cars in China when AMC invested 16 million dollars in 1983 To produce the Cherokee XJ. Peugeot contributed in the mid -80s to the creation of GAC as a car manufacturer, transforming what was a bus repair workshop into a company produced by Peugeot 505. Citroën arrived in 1992 and came to manufacture 719,000 cars in 2015.
Another western company in China Fallida. Stellantis’s case is not isolated. Is Another great western company that perishes in China Given the high competition, aggressive and regulatory costs of the country. It is the example that you don’t care who you are. Even Stellantis, the world’s largest car group (in terms of volume of brands and models), which began as a Peugeot partner and now has a full range of electric vehicles of its own creation, has not even been able to adapt to the Chinese market.
The new strategy: ally with China. Paradoxically, after leaving China as a manufacturer, Stellantis returned as a investor. Carlos Tavares bought in 2023 21% of Leapmotora Chinese company of electric vehicles, with the intention of sell these cars in Europe “With a great margin of benefits.” A strategy that reflects the new reality: if you cannot compete with China, join it.
Cover image | Dinkun Chen
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