Jeep closing only Chinese factory amid government meddling

Stellantis is reportedly shutting down its only Jeep factory in China due to increased meddling by the Chinese Communist Party (CCP).

According to Bloomberg, the carmaker is implementing an “asset-light” strategy in China due to rising tensions between the nation and the rest of the world which may cause economic sanctions.

“We have been seeing over the last few years more and more political interference in the world of business in China,” said Stellantis CEO Carlos Tavares.

“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.”

Stellantis also announced it will be terminating a 12-year partnership with state-owned Guangzhou Automobile Group last week, further influencing the decision to pull out of China.

American vehicle sales in China have also dropped by about a fifth in the first half of 2022, while local companies like BYD Co. and Geely sales have risen.

“We see that for Western players, selling cars in China is becoming increasingly difficult,” said Tavares.

Stellantis fear that sanctions like those imposed on Russia amid the war in Ukraine could impact their business if China were to conduct something similar in Taiwan.

Tavares also mentioned that the reason for Jeep’s departure ran deeper as it had lost trust in its local partner and the CCP favouring domestic carmakers.

Stellantis now plans to ship an electrified lineup to its Jeep dealers in China.