Fiat is to make cars and engines in China starting 2011. This will be a joint venture with Guangzhou Automobile Group. Fiat, the car-making component of a large industrial group, has been a little slow getting into the action, but now it is committed to move in a big way.
This is a 50:50 agreement with the partners investing more than $557 million and build a 700,000 sqm production plant in Changsha, Hunan province.
Fiat and GAC said the venture will eventually have the capacity to produce 140,000 cars and 220,000 engines a year initially, but could later be expanded to produce as many as 250,000 cars and 300,000 engines annually.
In 2007, Fiat terminated an unsuccessful joint venture with Nanjing Automotive, which had been distracted by efforts to develop Britain’s MG car brand, and has since been merged with Shanghai Automotive.
The Financial Times reports that Fiat’s parent group, which includes Iveco trucks and farm equipment producer CNH, has nine joint ventures in China employing about 13,000 people.