- Chrysler Group to distribute Chery-made small vehicles under Chrysler brands - Small vehicles to launch in NAFTA region, European region AUBURN HILLS, Mich., Jan. 4 /PRNewswire-FirstCall/ -- Chrysler Group President and CEO Tom LaSorda today confirmed that his company had reached an agreement in principle with Chery Sales Co. to distribute Chery-made small vehicles in the NAFTA region, European region and possibly other global markets. The agreement is subject to the approval of the DaimlerChrysler Supervisory Board and Chinese authorities. "Being able to partner with Chery represents a long-term solution to the challenges of how to profitably compete in the small vehicle segment," said LaSorda. "This supply partnership is part of a new business model that is allowing us to introduce all-new products more quickly, with less capital spending. This announcement reflects the realities of a global industry and DaimlerChrysler's need to remain competitive in all segments." Chrysler Group officials say the new vehicles, which will be sold under Chrysler Group brands, will attract new customers in two segments in which the Company doesn't currently compete: very young buyers and entry-level price- point buyers. These small, low-price segment vehicles are especially important in more price- and fuel-economy sensitive markets, including Canadian, Mexican and most European markets. The introduction of these new small vehicles represents an important addition to the Chrysler Group's already diverse product portfolio. LaSorda said that although historically Chrysler Group has been the most reliant upon trucks, minivans and sport-utility vehicles, the Company is now moving quickly toward smaller vehicles. LaSorda added that small cars are playing a major role in his Company's international growth. The Dodge Caliber has already become the Chrysler Group's No. 2-selling vehicle (behind Jeep Grand Cherokee) outside North America. "We already have a well-established relationship with Chery Automobile," added LaSorda. "Chery is the largest third-party customer of the Chrysler Group / BMW Group Tritec Engine joint venture in Brazil." Since 2004, Tritec 1.6-liter engines have been exported for use in the Chery A15 and Chery Fengyun. Chrysler Group designers will work with Chery on the new small vehicles, which are based on yet-to-be-announced Chery platforms, to create unique Chrysler Group styling cues. DaimlerChrysler engineers will also work closely with Chery to ensure these new vehicles meet all applicable safety and emission standards in markets where they're sold. Chery has already adopted some of the most state-of-the art manufacturing processes. The level of technology adopted in their plant rivals that of many western automakers. Chery is well on its way to becoming a world-class automaker, noted LaSorda, and meeting its goal to be the No. 1 Chinese automaker by 2010. Founded in 1997, Chery is China's largest exporter of domestically made vehicles. Pricing and additional product details will be revealed at a future date. DaimlerChrysler is expanding both sales and production in China. In 2006, DaimlerChrysler's joint venture BeijingBenz-DaimlerChrysler (BBDC) formally opened its new facility in Beijing. BBDC has been producing Mercedes-Benz E- Class sedans since December 2005, and began producing Chrysler 300C sedans in November 2006. BBDC also produces the Mitsubishi Outlander at its new facility. DaimlerChrysler is also planning to produce Mercedes-Benz transporters in Fuzhou with partners Fujian Motor Group (FJMG) and China Motor Corp. (CMC), in a new joint venture called DaimlerChrysler Vans China. The Chrysler Group is licensing production of its minivan to Southeast Motors, a separate joint venture of the same partners, also in Fuzhou. And the Company continues moving forward with its plans to realize production of heavy-duty and medium-duty trucks in China. The Chrysler Group is also licensing minivan production in Taiwan with CMC. The Company imports passenger cars and commercial vehicles to China under the Mercedes-Benz, Chrysler and Jeep brands. DATASOURCE: Chrysler Group CONTACT: Mike Aberlich, +1-248-512-2704, or , or David Elshoff, +1-248-512-2690, or , both of Chrysler Group Web site: http://www.media.daimlerchrysler.com/ http://www.daimlerchrysler.com/

Copyright