• Jul 4, 2007

Carlos Ghosn recently said that Renault/Nissan is developing a $3K car with Indian partner Tata. Honda said it looked at the same idea, but that it couldn't build a car with Honda values for that money. Chrysler has put itself in the Honda camp, ruling out the creation of a $3K car with Chinese partner Chery. Instead, Chrysler is working on a two-tier system that will build basic, inexpensive vehicles for developing countries and full-fat premium cars for the US, Canada, and Europe.

Chrysler's tie-in with Chery was put on hold when DaimlerChrysler put Chrysler on the block. Now that everything is settled with Cerberus, Chery is ready to sit down at the table again. Nothing's been signed and no timetable has been announced, but it appears that Chery-built Dodges (and possibly Chryslers) could appear before the end of the decade. Still, Frank Klegon, Chrysler's exec VP of product development, said he couldn't get a car built for less than $5,000, even in China. In response to Renault and Nissan's plans to build a $3K car for the Indian market, Klegon said "I have seen what you and I wouldn't necessarily call cars."

[Source: Autoweek]



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  • 28 Comments
      • 7 Years Ago
      Why do you have to make it a $3,000 car? Even $4,000 is fine. No need to squeeze that much. Considering right now in America the cheapest car is $10,999 I think a $7,000 dollar car that meets safety standards is low enough.

      Too many automakers set rediculous goals and then when they can't meet them give up all together.
        • 7 Years Ago
        As it says $3000 car is NOT FOR america. It's for developing nations like India where that is a lot of money.

        Has nobody at Cerebrus watched the brilliance of the "Brilliance"? Spend your money wisely somewhere else guys.
        • 7 Years Ago
        Peter, that video is somewhat misleading though since it shows an older Chery model, that's clearly based on late 1980's technology. None of the cars from that era did well in crash tests.

        Seriously, how is that even any worse than this:
        http://youtube.com/watch?v=lB0araA0T_k
        And that's a much newer vehicle than whatever car that Chery is knocked off of. Jeez.

        Racist Chinese-bashing drivel is starting to get really absurd on the comments in this blog. And picking a few of the worst-performing cars China has manufactured for these videos, while completely ignoring the fact that the Chinese didn't even come up with half these designs themselves, and ignoring the fact that everyone else was making cars equally unsafe just a few years ago is totally absurd.

        Until you actually have a crash test of the cars that Chrysler is actually going to sell in the US, I would stop assuming that it's any less safe than whatever you're driving unless you drive a Volvo or something.
        • 7 Years Ago
        I *live* in China, and have never seen a car crash that bad here (the worst I saw was a Volkswagen, incidentally- never saw a Chery crash). Guess drivers here are more skilled and know how to avoid accidents (if you live here you'd know- depending on the other driver's temper and amount of damage to the car, you'd wish you died instead).
        • 7 Years Ago
        @tekdemon
        But that's what I'm saying, sooner or later they will learn, not least through joint ventures like this.
        Perhaps that Chery really isn't state of the art even by Chinese standards. But so far any Chinese car we've seen crash tested didn't fare much better...
        • 7 Years Ago
        No need to look at Brilliance. The Brilliance was a car the Chinese deemed fit for the European market. The stuff Chery builds is actully worse if you can believe that:
        http://www.youtube.com/watch?v=4Swzbt76wBM

        But don't worry, through such joint ventures we'll give them the know-how to build real cars, and they know how to churn them out insanely cheap. We're still laughing, but western car makers should start bracing for impact...
        • 7 Years Ago
        Peter, that crash test video just about made me sick.

        I was hit at 55 mph right on the b-pillar in my '99 Dodge Stratus when I kid blew a red light. He was in a Chevy Blazer sized SUV, which broke my hip, and collapsed a lung. I had to have hip surgery a year later to correct it. All things considered though, I'm very lucky to be alive. I very strongly disagree with Chrysler's decision to partner with this company. I would never in my life buy a car from China, considering the things we've seen on this blog lately.
      • 7 Years Ago
      Is there an American alive who trusts the mainland Chinese to build an quality product anymore? Thgis deal is a big mistake. If they want offshore production, Korea's the place to go.
      • 7 Years Ago
      You guys are behind the deal was signed today!!!!
      • 7 Years Ago
      The three finalists for the Chrysler OEM deal were Chery, Hyundai, and Mitsubishi.

      Mitsubishi could not meet Chrysler's cost demand and Hyundai declined the Chrysler OEM deal because they were running out of capacity to build their own models. Chrysler had no choice but to go to China.

      Chery's probably losing money on this OEM deal, since Chery cannot build US and EU legal cars for $7000. This is nothing new, Chery's own low-end models are money losers too.
      • 7 Years Ago
      Tina, you don't know what you are talking about, I've lived with both systems I DO know the difference, This system sucks, even when you have the coverage you still have to pay big bucks and could go broke, Tell me its socialism when you go bankrupt, having coverage doesn't mean you will be OK, it means the Insurance will help you pay some of the bills, They make the Decisions you have to live with.

      Prescriptions cost far too much here, in Europe they have a $10 co-pay, totally Free when you reach 65, I know some people who need drugs constantly, they pay a one time fee of $180 per year and are totally covered, these are the same drugs we buy here, My Mother here in the USA pays $500 a month for hers, there is no Comparison. Same Drugs, Different price.

      We have be Conned or brainwashed by the Government and media that Universal healthcare is bad, this is the Rich telling us what we should have, while they fill there pockets again.

      If we had the Universal healthcare General Motors wouldn't be in their sad situation today, The cost of healthcare makes their cars more expensive, Japanese makers don't have these costs.

      Theirs is not a perfect system but neither is ours.
      • 7 Years Ago
      Philip- Universal health care is Socialism. There are many pitfalls to it. Do your homework and read about it.
        • 7 Years Ago
        I've done my homework and read about it - universal health coverage is the only solution. Don't let the "S" word cloud your thinking and prejudice your views. How much money you have should never enter the healthcare equation.
      • 7 Years Ago
      Whofan has it right, Healthcare is a big part of this countries problem, we need a better system, a Universal system for everyrone, I dont see any other modern country that would like to have our health system, We are getting screwed by the powers above, Insurance should not be involded in heathcare, and Bankruptcy shouldnt happen in this country becuase of medical bills, I dont know of anyone on the Uk that has gone bankrupt over heathcare/medical bills.

      Look how well we have done recently buying human food and Petfood from the Chinese, Camera's ands Tv's may be OK but Cars No Way, I would never lower myself, its all a matter of TRUST, values and Principals.
      BUYER'S BEWARE.
      • 7 Years Ago
      • 7 Years Ago
      I must say I'm alarmed at the numerous posts from individuals who feel the government can take care of them. Ask yourselves this, when was the last time you stood in line at a dmv or post office? Remember Walter Reed, that is government healthcare, or dealt with social services and the mountains of paperwork. Just recently the passport debacle, please spare me. So my prejudice Mallory is I believe in the individual to decide what is right for them not the NANNY GOVERNMENT!
      • 7 Years Ago
      Honda and Hyundai have explicitly stated that it was not any cheaper to build their cars in China, they are doing it only to avoid the 30% import tax on automobiles. Chinese brand cars are cheaper only because they use cheap steel, cheap defective parts, Euro-II level emission and skip on safety features. Once your Chinamobile has to meet the US and Eu regulations, it is no cheaper than contemporary Japanese/Korean cars, as evident by Brilliance's $20,000 BS6 due to arrive in America next year.

      BTW, there is actually one place that builds EU-legal car for less than $5000 in the world, that's Kia's Picanto plant in Korea, the world's most efficient auto plant with 173 cars/worker a year.
      • 7 Years Ago
      Good Lord, some people simply astound me on here. If Chrysler sells these cars here do you think they will be somehow exempt from the US's safety regulations? That answer would be NO! I realize a lot of people like to speak before they think, but this one is a no-brainer. The fact remains that if Chrysler properly executes this whole thing and is able to undercut even the likes of Kia while giving a a good warranty then Auburn Hills will sell a boatload.
        • 7 Years Ago
        This is a simple OEM deal. Chrysler won't spend a dime to engineer those cars. They are rebadged Cherys and it is simple as that.

        Chery has an ill-reputation for sacrificing quality to cut prices and stealing anybody's tech(even rival Chinese firms, not just foreigners) even in China.

        What you are looking at is a shady car from an unethical business. Don't expect miracles.
        • 7 Years Ago
        AMGoff, Those cars are intended to be sold in the Chinese market, thus they won't need to pass U.S Safety regulations. They won't have to pass any regulations because I guess China doesn't have any.
        • 7 Years Ago
        So you mean that these cars won't have to pass US safety regulations? If so could you please explain to all of us why? I can understand that any quality materials will be lacking, but does anyone buying a $10K really expect to be getting that much?
        • 7 Years Ago
        AMGoff, Those cars are intended to be sold in the Chinese market, thus they won't need to pass U.S Safety regulations. They won't have to pass any regulations because I guess China doesn't have any.
        • 7 Years Ago
        Ahem...

        "Instead, Chrysler is working on a two-tier system that will build basic, inexpensive vehicles for developing countries and full-fat premium cars for the US, Canada, and Europe."

        Am I the only one who can read?
      • 7 Years Ago
      When the Korean cars first hit the US market, it was viewed very lowly, cheap, unreliable, shoddy quality and it even considered pulling out of the market. And even after 20 years being in the market, it is still not that widely present in european or american market. And when the Korean first started out, they copied the Japanese a lot.

      Of course, Chrysler is not going to tolerate bad quality, so by signing the contracts, chrysler has to guarantee that those Chinese made cars must satify the regulation set by american standards before hitting the american shore. And in fact, quality control and monitor of Chinese products are getting tighter these days in america.

      And not long ago, people were saying exactly the same thing that they were not going to buy a japanese car ever in their lives and now look at what happen.
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