China: Chery car not yet up to standard for US - Chrysler

By: Michael Murphy, Wednesday, April 23, 2008,

Tags: Chrysler Group LLC, Future Models, Joint Ventures, OEM Strategy.

AutomotiveWorld.com

The small car that Chery is preparing to supply to Chrysler for the North American and European markets is not yet up to the necessary quality standard, according to an Associated Press report that quoted Phil Murtaugh, chief executive of Chrysler's Asia operations.

Murtaugh declined to specify a timeframe for concluding the development work and clearing the way for what had been expected to become one of the first Chinese-made cars to be sold in large volumes in developed markets.

"Neither Chrysler nor Chery is comfortable that those products as they exist today meet the requirements of Chrysler, and we're working together to make changes that we're both happy with," Murtaugh said. "I don't think we're too far away, but neither of us is ready to say 'let's go' yet," he said to reporters on the sidelines of the Beijing Auto Show. "We're working to make sure the product's right."

Murtaugh said that Chrysler and Chery were reviewing safety-related issues such as body structure in order to ensure that the resulting vehicle could be marketed successfully overseas. "Safety is a huge challenge because of the size of the car," said Murtaugh. "There are some challenges. They are not huge changes but they are technical challenges in certain parts of the car," he said, adding that, "We don't have to re-engineer the whole car."

Chery Chairman, Yin Tongyao, speaking at a separate event, was cautious about his company's aspirations to begin US sales after years of pledging to break into the North American market. North America and Europe are "very mature markets," Yin said. "We can't get into those markets too quickly, so we should explore those markets in a gradual manner and do it step-by-step. We should not aim too high."

Published on Wednesday, April 23, 2008