Fiat Group said yesterday it will buy engines from China's Chery Automobile Co (奇瑞汽車), expanding the ambitious Chinese automaker's foreign ties just a month after it signed a deal with Chrysler to export cars to the US.
The agreement came as global automakers look to China as a low-cost production base for export and the country's own small but fast-growing competitors try to expand sales abroad.
Chery, China's biggest domestic automaker, will supply 100,000 1.6 and 1.8-liter engines a year for use in cars manufactured by Fiat in China and abroad, the two companies said in a joint statement.
PHOTO: AP
"The agreement will give Chery increased competitiveness on the international market," Yin Tongyao (尹同耀), president of 10-year-old Chery, said in the statement.
Chery and Fiat Group, a subsidiary of Italy's Fiat SpA, are looking at "further cooperation," Fiat Group CEO Sergio Marchionne was quoted as saying.
Chery, based in Wuhu, signed a deal with Chrysler LLC last month on a low-cost production venture to export cars to the US. Chrysler CEO Tom LaSorda said the two companies would jointly develop future models.
Japan's Honda Motor Co has exported Chinese-built Jazz subcompacts to Europe since 2005. Other companies have announced plans to export Chinese-made cars to the US but none has made it to market.
China overtook Japan last year to become the world's No. 2 vehicle market after the US.
The market is dominated by global automakers such as General Motors Corp and Volkswagen AG, but the country's small producers are expanding aggressively.
China's automakers exported 325,000 vehicles last year, about 80 percent of them low-priced trucks and buses for other developing markets in Asia, Africa and Latin America, the government said.
Chinese producers are eager to expand to US and European markets, but industry analysts say they lack the technology to meet environmental and safety standards on their own.
More are expected to make deals like Chery's in hopes that foreign partners will improve their skills.
"The agreement means that Fiat, who had been testing Chery's engines during the past year, have recognized the technologies and quality of the engines developed by Chery," Xinhua news agency quoted Chery deputy general manager Zhou Biren as saying.
Last year, Chery reported sales of about 310,000 cars, with 40,000 of those exported. Its target this year is 390,000 cars, with 70,000 sold abroad.
The company assembles vehicles with partners in Iran, Malaysia, Russia, Ukraine, Brazil and Egypt. It announced plans in March to open its first Latin American factory in Uruguay with an Argentine partner.
Chinese car sales rose 37 percent last year to 3.8 million, while total vehicle sales rose 25.1 percent to 7.2 million, the China Association of Automobile Manufacturers said.
Beijing is pressing its dozens of small auto producers to merge in order to compete with bigger, richer foreign rivals.
Last month, two of China's biggest domestic automakers, Shanghai Automotive Industries Corp and Nanjing Automobile Corp, announced a deal to combine efforts in design, production and sales.
UPDATED (3:40pm): A suspected gas explosion at a shopping mall in Taichung this morning has killed four people and injured 20 others, as emergency responders continue to investigate. The explosion occurred on the 12th floor of the Shin Kong Mitsukoshi in Situn District (西屯) at 11:33am. One person was declared dead at the scene, while three people were declared deceased later after receiving emergency treatment. Another 20 people sustained major or minor injuries. The Taichung Fire Bureau said it received a report of the explosion at 11:33am and sent rescuers to respond. The cause of the explosion is still under investigation, it said. The National Fire
ACCOUNTABILITY: The incident, which occured at a Shin Kong Mitsukoshi Department Store in Taichung, was allegedly caused by a gas explosion on the 12th floor Shin Kong Group (新光集團) president Richard Wu (吳昕陽) yesterday said the company would take responsibility for an apparent gas explosion that resulted in four deaths and 26 injuries at Shin Kong Mitsukoshi Zhonggang Store in Taichung yesterday. The Taichung Fire Bureau at 11:33am yesterday received a report saying that people were injured after an explosion at the department store on Section 3 of Taiwan Boulevard in Taichung’s Situn District (西屯). It sent 56 ambulances and 136 paramedics to the site, with the people injured sent to Cheng Ching Hospital’s Chung Kang Branch, Wuri Lin Shin Hospital, Taichung Veterans General Hospital or Chung
ALL-IN-ONE: A company in Tainan and another in New Taipei City offer tours to China during which Taiwanese can apply for a Chinese ID card, the source said The National Immigration Agency and national security authorities have identified at least five companies that help Taiwanese apply for Chinese identification cards while traveling in China, a source said yesterday. The issue has garnered attention in the past few months after YouTuber “Pa Chiung” (八炯) said that there are companies in Taiwan that help Taiwanese apply for Chinese documents. Minister of the Interior Liu Shyh-fang (劉世芳) last week said that three to five public relations firms in southern and northern Taiwan have allegedly assisted Taiwanese in applying for Chinese ID cards and were under investigation for potential contraventions of the Act Governing
‘LAWFUL USE’: The last time a US warship transited the Taiwan Strait was on Oct. 20 last year, and this week’s transit is the first of US President Donald Trump’s second term Two US military vessels transited the Taiwan Strait from Sunday through early yesterday, the Ministry of National Defense said in a statement, the first such mission since US President Donald Trump took office last month. The two vessels sailed south through the Strait, the ministry said, adding that it closely monitored nearby airspace and waters at the time and observed nothing unusual. The ministry did not name the two vessels, but the US Navy identified them as the Arleigh Burke-class guided-missile destroyer USS Ralph Johnson and the Pathfinder-class survey ship USNS Bowditch. The ships carried out a north-to-south transit from