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2:12 pm
Tue January 15, 2013

Jeeps to be built in China, Chrysler and Guangzhou announce deal

At the North American International Auto Show today, the Chinese-owned Guangzhou Automobile Group, or GAC Motors, announced plans to build Jeeps to sell in the Chinese market.

GAC Motors is a state-owned automobile business located in the city of Guangzhou in southern China.

More on the announcement from Brent Snavely of the Detroit Free Press:

Under the agreement, Guangzhou will build Jeeps in China for Chrysler for sale in China. A specific model was not announced.

The agreement was signed at Chrysler Headquarters in Auburn Hills, Mich., by Zeng Qinghong, general manager of GAC Group, and Mike Manley, President and CEO of Jeep and head of Chrysler’s international operations.

Norihiko Shirouzu reports for Reuters that GAC Motors does business with Toyota, Honda, and Fiat SpA.... and now, with the announcement of today's Jeep deal, for Chrysler as well.

Shirouzu reports other Chinese automakers did not make the trip to Detroit this year, and that Chinese automakers have a long way to go before they can sell their cars in the North American market:

GAC Motor executives did not respond to questions by Reuters on whether the company harbors ambitions to sell cars in advanced markets such as the United States and Canada, but some indigenous Chinese automakers are getting close, some experts and industry insiders said.

At the least, they believe those Chinese automakers are closing the quality gap rapidly enough that they might in five years or so become theoretically ready to start thinking about selling cars in the U.S. and other mature auto markets.

Analysts point out that timetable could be a little longer, as it will take more than just closing the quality gap to open up markets in this part of the world. They say Chinese automakers would also have to build trust with consumers here as well.