Chrysler broke off negotiations with China’s Chery automotive to produce small cars for the Chinese and US markets, reported the Wall Street Journal. Chrysler said that discussions to have Chery produce the cars were cut short due to the economic crisis. Chrysler said the decision did not have implications for its other business partnerships. The talks with Chery, which began in 2007 and lasted a year, at first appeared a promising opportunity for Chrysler to expand overseas and develop its small car product line. Chrysler’s efforts to penetrate foreign markets have not been very successful in the past and it is in trouble at home. Sales fell 47% this year compared to 2007 sales, and it has told the US Congress it needs US$7 billion in loans to avoid bankruptcy. Separately, Chery announced that it does not plan to use the US$1.45 billion loan it recently secured from China Import-Export Bank to make any investments in the US auto sector for the time being, and will instead instead on improving product quality.