China’s Great Wall Motor signalled on Monday its intention to make an ambitious acquisition deal with Italian-American car maker Fiat Chrysler Automobiles following a report that it wants to buy the Jeep brand.
An agreement would be a major coup for the Chinese auto industry, though it may cause political waves in the United States, where President Donald Trump has railed against his country’s trade imbalance with the Asian giant.
Great Wall Motor ranks only as the seventh biggest Chinese auto company in terms of sales–1.07 million in China and 17,400 abroad last year–but any purchase of FCA would take the firm to another level.
“There is an intention to make the purchase,” a Great Wall Motor spokeswoman told AFP, though she declined to say if the possible deal would be for the entire auto giant or just one of its brands.
The US car industry publication Automotive News reported earlier that Great Wall Motor president Wang Fengying had said in an email that her company intended to buy FCA’s Jeep brand.
FCA said in a statement that it “has not been approached by Great Wall (Motor) in connection with the Jeep brand or any other matter relating to its business.” Great Wall’s spokeswoman did not confirm whether the companies had made any contact yet but she confirmed the intention to make an offer.
Bill Russo, managing director of Gao Feng Advisory Group, said he believes Great Wall Motor is interested in just buying Jeep rather than buying all of FCA and inheriting its sizeable liabilities.
“Jeep is the crown jewel of Fiat Chrysler in terms of brand and equity,” Russo, a former Chrysler executive, told AFP.
Great Wall is known for its sport-utility vehicles, which are popular in China, so a deal would be “quite complementary” for the company, the analyst said.
China is the world’s biggest car market and sales of SUVs soared by 45 percent last year, with nine million units sold, according to industry figures. (The Jakarta Post, Julien Girault, Agence France-Presse)