Ten days after the automaker Stellantis announced the “orderly termination” of the 12-year joint venture with GAC Group in China, CEO Carlos Tavares said Thursday the sector is assisting to more and more difficulties for Western automakers to sell cars in China.
“We have been seeing over the last few years more and more political interference in the world of business in China. We don’t want to be a victim of cross-sanctions as has been the case for other companies in other regions of the world recently,” Tavares said.
“We see that for Western players, selling cars in China is becoming increasingly difficult. There is an absolutely major shift in the Chinese market. We have two big competitors, Volkswagen and GM, who are very present in China. I wouldn’t want to be in their place,” Stellantis CEO added.
When Stellantis announced the “orderly termination” of the joint venture with GAC Group, the automaker said it that plans to focus “on distributing imported vehicles for the Jeep brand in China” implementing an asset-light approach.
Today, Tavares said the decision was made due to “broken trust” but also “the Chinese Communist Party and its economic policies supporting domestic auto companies”.
The automaker that includes brands like Chrysler, Jeep, Maserati and Opel will recognize a non-cash impairment charge of around $301 million in its first half of 2022 results after the termination of the joint venture.
Stellantis said the termination is due to “a lack of progress in the previously announced plan for Stellantis to take a majority share of the GAC-Stellantis joint venture”, adding that the Jeep brand will continue “to strengthen its product offering in China with an enhanced electrified line-up of imported vehicles meant to exceed Chinese customer expectations”.