By on August 21, 2017

2017 Jeep® Grand Cherokee Trailhawk Great Wall logo - Image: FCA/Great WallIn the week that’s elapsed since initial reports surfaced of a Chinese automaker planning a takeover of Fiat Chrysler Automobiles, Geely, Dongfeng, and Guangzhou Automobile Group have all taken themselves out of the running.

Automotive News now reports, however, that the seventh-largest automaker in China, Great Wall Motors Company, has a keen interest in FCA, which has long courted unwilling suitors.

There’s one outstanding issue. Great Wall Motors Co. is open about its desire to acquire Jeep as part of a mission “to become the world’s largest SUV maker,” but Great Wall doesn’t want FCA’s other, far less valuable entities. 

Through its Haval brand, China’s Great Wall already greatly prioritizes SUVs. Of the 1.1 million vehicles Great Wall Motors sold in 2016, 85 percent were utility vehicles.

It’s not surprising that Great Wall would have a desire to acquire Jeep without the Chrysler, Dodge, Fiat, and Ram divisions clinging to the a seven-slat grille. According to recent Morgan Stanley reports, Jeep is worth roughly $33.5 billion. FCA, including Jeep, is worth $32 billion.

You do the math.

Because of Jeep’s current successes and huge global potential, Great Wall Motors Co. is surely not the only company that would happily take Jeep off FCA’s hands. Great Wall may nevertheless be the company that is most transparent about its interest in one of America’s most storied brands.

Great Wall Motors’ president, Wang Fengying, spoke candidly via email with Automotive News about her company’s intention to pursue a purchase of FCA’s Jeep brand, which accounted last year for 37 percent of FCA’s U.S. sales and 30 percent of the automaker’s 4.7 million global sales. Great Wall spokesperson Xu Hui doubled down.

“We are deeply interested in the Jeep brand,” Hui said. Can Great Wall even afford to buy Jeep? “We can make use of our accumulated profits as well as our access to the capital market to make the deal happen,” Hui tells Autmotive News.

Great Wall has, of course, had plans in the past that did not pan out. Wang Fengying said nearly a decade ago that Great Wall would be selling vehicles in the United States in 2013. It’s now 2017. Look around. See any Great Wall Motors Co. dealers? No.

Furthermore, standing in Great Wall’s way will be numerous other automakers which — if Jeep truly is available as a standalone, isolated, one-off sale — would be more than happy to take the SUV brand off FCA’s hands. Whether FCA has the desire to do so on financial terms is one factor that has likely already been considered. Whether FCA has the will to extricate Jeep from FCA’s tentacles is another major wrench in the works.

Weng Fengying isn’t the only automotive boss with heady goals. Fengying wants Jeep so Great Wall can be the world’s largest SUV maker. FCA’s Sergio Marchionne, meanwhile, believes Jeep is the one brand that could claim 20 percent of the global auto market, more than 12 times its current share.

[Image: © 2016 Timothy Cain/The Truth About Cars, FCA]

Timothy Cain is a contributing analyst at The Truth About Cars and Autofocus.ca and the founder and former editor of GoodCarBadCar.net. Follow on Twitter @timcaincars.

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66 Comments on “China’s Great Wall Motors Co. Completely Open About Its Desire to Purchase Jeep, But Not FCA...”


  • avatar
    PrincipalDan

    According to recent Morgan Stanley reports, Jeep is worth roughly $33.5 billion. FCA, including Jeep, is worth $32 billion.

    Really? I’d think FCA INCLUDING Jeep would be worth much less than that. RAM is worth something, the HEMI is worth something but what else have they got that someone else hasn’t got.

    Should have used the bankruptcy as an opportunity to form a massive auto concern out of the best parts of GM and Chrysler.

    • 0 avatar
      mason

      It would be interesting to know exactly what Ram is “worth.” It has to be a + integer which means the rest of FCA is in serious trouble.

    • 0 avatar
      FreedMike

      Could be that the cost of *keeping Jeep and getting rid of everything else* would make the company worth less than it appears to be on paper. Remember, if Chrysler and Dodge get closed down, that’s going to mean plant and dealership closings. That costs money.

      • 0 avatar
        Speed3

        Its definitely possible to cleave out Jeep (and other parts of FCA) and saddle the rest of the company with everything else.

        • 0 avatar
          DeadWeight

          *We are loving in OBJECTIVELY INSANE times, yet again (this period mirrors the 1918-1928 period in many ways, economically and geopolitically, and the 1997-1999 phase in tech/high-beta stock companies, specifically).

          Tesla is now the #1 largest U.S. branded & #4th largest (global) automaker, by market capitalization, despite selling a mere 76,000 cars annually, losing 2 billion+ per year (set to accelerate with Model 3 rollout and alleged massive production surge – they’ll lose money faster – particularly if EV credits run dry).

          We are living in OBJECTIVELY INSANE times. It happens once in a while, and things always end badly when it does.

  • avatar
    SCE to AUX

    Jeep is valuable, but not *that* valuable.

    Its star has risen dramatically in the last 8 years, but it’s also leveled off. It’s possible their market share has peaked, so what can they do next?

    To be a contrarian, it’s possible FCA would do better *without* Jeep, which has to be a resource black hole for development. Its CAFE numbers can’t be helping the corporation, either.

    • 0 avatar
      dmoan

      I would say it is free fall right now. Cherokee and GC have so many quality issues whoever who buys is in hook to pay for all the warranty bills. And also with no EV play, Jeep is not great buy for anyone.

      • 0 avatar
        Serpens

        @dmoan

        Haha I’m sorry but that is laughbable. The fact of the matter is that Jeep’s quality is exactly as it’s always been. They’ve never been a paragon of reliability and both the Cherokee and Grand Cherokee have actually improved from launch (Cherokee) and the facelift (Grand Cherokee).

        As far as EV’s are concerned, any company that would buy them would have to re-engineer the car to accept their own EV technology anyways. In the future you’re going to see the Pacifica’s hybrid tech proliferate across the lineup and they’re actually not as far behind with EV development as you think they are.

        • 0 avatar
          dmoan

          Jeep was improving last 5-7 years ago but new and updated models introduced under FCA have had a lot of quality issues.

          I would not say Cherokee KL has been improved i have 2016 and its plagued with issues only thing they improved from previous years was transmission. My neighbor just bought a GC Summitt 6 months ago and its been dealership for repairs 4 times so far. Whats worse about Chrysler products is not just the reliability, is the poor customer service that goes with it..

          • 0 avatar
            Serpens

            @dmoan

            The stats prove otherwise from just about every publication. The Grand Cherokee’s 2 most recent low points were 2011 at WK2 launch and again in 2014 with the facelift launch.

            You’re missing the point- they’ve always been plauged with issues. The Grand Cherokees over years past and even the Jeep Liberty did not have good reliability records. This has continued to be an issue under FCA but certainly isn’t getting any worse. Early reports of the Compass have been positive but we’ll see. And you might not the Chrysler Pacifica long-term tests have actually been going very well.

            Now one thing we can agree on is the service. FCA dealers suck and when you do have a problem, it frequently requires multiple visits to actually get a problem resolved.

        • 0 avatar
          whynot

          Exactly. My family had a ’99 XJ Cherokee for 11 years bought brand new. The engine was of course great and never had any issues up until the end.

          The rest of the car however? Well the hood that warped so much it was near impossible to open (note the car was never used off road), the A/C broke repeatedly until my parents stopped even bothering to repair it, the windshield washers stopped working, the heater eventually stopped working, 1 of the 4 speakers stopped working (another was on its last legs making an annoying buzzing sound), the foglights stopped working, and various interior trim pieces broke off plus probably a few other things I am forgetting.

          I loved the thing, but it was not an epitome of build quality.

      • 0 avatar

        Grand cherokee sales are on the rise. Cherokee is currently the only issue with jeep.

      • 0 avatar
        MrIcky

        I laugh everytime someone pulls out the ‘with no EV play’ card as if that is what’s going to sink Chrysler. Basically same as ‘with no small sedan chrysler’s doomed’ that we heard a year ago.

        No one making EV’s is making money on EV’s. Even Tesla has to do some pretty questionable (non-gaap) accounting to show a profit. Musk says GAAPs for chumps though, so whatever.

        Every year, more off-the-shelf engineered product exists to tap into and shorten the cycle time to put an ev on the market. If a company has thrown it’s hat in the ring now, it knows its basically just proving a point that it can with it’s own engineering.

        As far as hybrids go, every ZF transmission is designed to be turned into a mild hybrid making it pretty straightforward, so I don’t think Chrysler sees most hybrids as a money maker.

    • 0 avatar
      JimZ

      ” it’s possible FCA would do better *without* Jeep, which has to be a resource black hole for development.”

      calling it a “resource black hole” would imply they’re spending a ton of money on it with no return. Considering Jeeps are selling pretty much hand-over-fist they’re the polar opposite of a black hole.

      the real “resource black hole” is Alfa.

      • 0 avatar
        FreedMike

        Looking at Alfa sales, I’d say that theoretically, it’s NOT a “resource black hole” at all. The luxury market has been stagnant, and in need of new blood, for a long time now. Look at how Volvo and Jaguar have come back. And look how Alfas are selling. That’s why I’m so hard on them – there’s clearly room for a new player here, and I’m delighted that it’s one that emphasizes performance.

        The question with Alfa isn’t whether there’s a market for them in this country – it’s whether the product is any good. Time will tell. But a waste of time? Hardly.

        • 0 avatar
          JimZ

          “And look how Alfas are selling.”

          er… not well? basically running at most 10% of the BMW 3 series monthly.

          • 0 avatar
            FreedMike

            Yes, let’s look at 3-series sales in particular – they’ve fallen off a cliff this year. The model is on pace for a 15,000 unit decrease from last year.

            Now take a look at the numbers for the Jaguar XE and Giulia, which are both direct competitors to the 3-series and sell on looks and performance. The XE is on pace for 10,000 sales this year, up from about 6,000 last year. The Giulia is on pace for around 8,000 sales this year. Together, that’s 12,000 compact sport sedan sales in a segment that is supposedly shrinking. Guess where a large chunk of the 3-series buyers went?

            Alfa is no threat to BMW or Mercedes – yet. But if their product proves to be reliable (big *if*) they could carve themselves out a nice smaller business. They could have something here if FCA doesn’t f**k it up.

          • 0 avatar

            Giulia out sold the ATS and XE several months. For a brand that was dead in the US until a couple years ago with a tiny dealer footprint that’s pretty impressive.

          • 0 avatar
            dukeisduke

            Alfa’s stuff is garbage. Until they fix the quality and reliability problems, they’re dead in the water.

      • 0 avatar
        Lou_BC

        I don’t see Jeep as a resource black hole. The Wrangler and Unlimited variant are spartan products selling at a premium price. I can get multiple products with better comfort, fit and finish for the same price.

        In the FCA portfolio we have Jeep, Ram and any V8 powered car keeping them in orbit just beyond the event horizon.

    • 0 avatar
      Speed3

      It’s hard to imagine a path forward for FCA if they sell Jeep. Sure they would have a lot of cash to plow into R&D, maybe quickly develop some Dodge and Chrysler crossovers. But selling Jeep would be a massive loss in volume.

      If it were me I would pump all that money into Alfa and Maserati, spin them off and let Chrysler Dodge Ram Fiat wilt.

  • avatar
    sportyaccordy

    Dang. This is like when a group of girls go to a club, and the bouncer only wants to let the hottest one in. Dem harsh realities doe.

    It sucks because FCA is not a well run company that just needs more resources. They need to cleanse their debt palate and toss all the leadership. Tough situation.

  • avatar
    quaquaqua

    I think a ton of automakers would want just Jeep, an automaker with the same terrible track record of crappily-built cars as Chrysler, yet they’re somehow immune to criticism. That’s worth a lot, though I can’t help but feel that this recent leveling off of their sales (despite their competitors growing rapidly in just the past year) must have something to do with the quality of their lineup.

  • avatar

    Without Jeep FCA is a flaming bag of dung. Sergio is an idiot.

  • avatar
    1500cc

    I’ve always thought Toyota and FCA would make great partners … they’re each strong where the other is not. Adding Ram and Jeep (and discarding the rest) would flush out Toyota’s lineup and give them serious presence in all major segments.

    Of course Toyota would never want anything to do with the dumpster fire that is FCA.

    • 0 avatar
      JimZ

      why not? They’d be running the show. since FCA’s problems mainly seem to be in management, that’s one thing Toyota could be quite adept at fixing.

    • 0 avatar
      FreedMike

      I’ll tell you why this isn’t happening: in my neighborhood, the Toyota dealer is right across the street from the Dodge/Ram dealer and a block away from the Chrysler/Jeep store. Repeat that hundreds of times in hundreds of cities and towns across the U.S., and you have the reason why Toyota would never touch Jeep.

      Toyota would have to shut down HUNDREDS of dealers, close scores of FCA plants, and get rid of tens of thousands of FCA workers, to buy Jeep. It’d cost BILLIONS on top of the cost of the merger itself.

      No way.

    • 0 avatar
      Speed3

      I have always thought that Jeep would compliment Honda’s portfolio and Honda can bring all the same value as Toyota – management, quality, etc.

    • 0 avatar
      PenguinBoy

      “I’ve always thought Toyota and FCA would make great partners … they’re each strong where the other is not.”
      That may be true, but I expect the different cultures would cause a merger like this to fail. I doubt you can implement the focus and discipline required to churn out 500,000 consistently built Corollas without stifling the kind of creativity an irrational exuberance that produces a Hellcat.

  • avatar
    Scoutdude

    Nothing new here. When word went out that Mercedes wanted to unload the Chrysler car business, it brought lots of suitors that wanted to make offers on Jeep and Jeep alone. Then they started trying to sell everything except Jeep. Again the inquires were about Jeep. So they put the whole mess up for sale, lock, stock and barrel. Again no automotive company wanted to take the entire mess, they wanted Jeep and maybe the Dodge truck line.

  • avatar
    FreedMike

    Think how much better this would have been had FCA NOT failed so epically with the 200 and Dart. With those, they could sell the “we have a full line of competitive vehicles” line to a merger partner.

    Now, all they have is Jeep.

    • 0 avatar
      MrIcky

      If the 200 and Dart were competitive, it wouldn’t help a bit as that whole segment sucks. Cutting any attempt at swimming in that segment was a good thing.

  • avatar
    Chocolatedeath

    I am going to try and not come off as a xenophobe, however I for one do not like the idea of Jeep or any other part of Chrysler being owned by the Chinese. I would accept Nissan or Kia or even a small player like Mazda buying them. Think what Mazda could do with the pieces that DC has. They would instantly have a Minivan(all new platform), a nice truck series, an aging but paid for large rear drive platform and Jeep (the crown).
    They would have to get it cheap though. FC is not worth that much. I would give them about 5 billion for the lot.

    • 0 avatar
      FreedMike

      I’m not sold on Mazda. All it’d get would be a) large trucks, which Mazda buyers probably have no interest in, and midsize/compact CUVs, which Mazda already is doing well with. FCA would get passenger sedans that aren’t selling as things stand. I mean, really, does a Dodge badge on a Mazda 3 magically make it sell?

      And there’s so much duplication between their dealer network and FCA’s – lots of “legacy” stores from both manufacturers would have to be culled. That would cost an unholy amount of money.

      No, the buyout has to come from overseas, from a company with no U.S. presence.

      • 0 avatar
        JimZ

        “I’m not sold on Mazda. All it’d get would be a) large trucks, which Mazda buyers probably have no interest in, ”

        I think you’re looking at it from the wrong angle- it’s not that Mazda customers would start buying big trucks, but that Mazda would be gaining all of those Ram customers.

        • 0 avatar
          PrincipalDan

          SKYACTIVE HEMI! Imagine how long the hoods would be!

        • 0 avatar
          FreedMike

          “Mazda would be gaining all of those Ram customers…”

          Number of folks who walk into a Mazda dealership looking for a truck: zero.

          Number of folks who walk into a Mazda dealership looking for a Ram truck: one, and he was blind and had no business buying a motor vehicle anyway.

          And this would be AFTER the combined company would have to shell out God only knows how much money to close down the duplicate dealerships.

          This matchup wouldn’t work. I could see Mazda making compact and midsize sedans for FCA, ala their Yaris iA arrangement they have with Toyota, but a merger? Nope.

    • 0 avatar
      2manycars

      I’m not really sure how I would feel about the Chinamen buying Jeep. At least Jeep would no longer be in the hands of the Axis powers if that happened.

  • avatar
    Tstag

    I’m a little surprised Sergio hasn’t attempted to merge with PSA. PSA would be able to give FCAs passenger car division a massive boost….

  • avatar
    slap

    GWM should buy FCA and sell or shut down the Fiat/Alfa/Maserati stuff. Keep the Dodge/Chrysler dealer network for the GWM cars.

  • avatar
    Tstag

    According to the FT FCA have also been talking to TATA. In many ways a TATA FCA merger could work. Fiat could provide cars desperately needed by TATA, JLR could make a sucess of Alfa and Land Rover has obvious synergies with Jeep….

    However does Tata want the headache?

    • 0 avatar
      dmoan

      I think TATA is trying to get Fiat not merge with them. As you pointed out mainstream vehicle brand Tata is not doing well. Fiat brand will give them platform of vehicles that they use to complete against Maruti.

      Jeep is has way too much baggage for Tata to handle.

  • avatar
    Superdessucke

    The Chinese owning Jeep? Jeep?? Has it really come to this? I hope the President is planning to send in the Green Berets to get that nameplate back if they do sell it to China.

  • avatar
    Speed3

    A sale of Jeep sounds like a good plan B when nobody wanted to merge with FCA that still achieves their strategic objectives:
    A) the Agnelli family wants out. There all kinds of fun ways to slice and dice FCA’s assets. A sale of Jeep could also be a good way to reorg and let the Agnellis cash out.

    B) Sergio wants to retire and needs his golden parachute. A Jeep sale could basically serve as the same mechanism.

    C) FCA needs serious Ca$h and had a lot of ddebt (with double Ds).

    I think it’s fun to imagine the different ways the company could be divided. My ideal would be to to split into two companies – FCA Class and FCA Trash. Jeep – Alfa Romeo – Maserati is the classy company (obviously) Chrysler, Dodge, Fiat, Ram is the trashy one. Leave all the debt and underutilized plants with Chrysler.

    Jeep will do great and Chrysler will be a ticking bankruptcy bomb.

    But think about how much value will be unlocked!?! Wall Street will love it.

  • avatar
    stingray65

    What most people are missing is that it is only the Jeep BRAND that is worth something. The vehicles themselves, the plants, and even most of the dealers are probably worth negative dollars, because no one really wants them and the costs of shutting them down. If Toyota or Mazda or Honda bought Jeep, I suspect you would see a Jeep version CX5 or RAV4 or Ridgeline made in Mazda, Toyota, or Honda factories rather than “real” Jeeps. The RAM brand might be worth something in the US, but not anywhere else. Chrysler, Alfa, and Fiat brands are probably worth negative money since their reputations have dropped so dramatically, and certainly the old platforms and old plants and less than stellar dealer are worth way less than nothing.

    • 0 avatar
      th009

      “I suspect you would see a Jeep version CX5 or RAV4 or Ridgeline made in Mazda, Toyota, or Honda factories rather than “real” Jeeps.”

      Kind of like the Renegade?

  • avatar
    Petra

    Jeep: the Helen of Troy of automobile brands.

  • avatar

    They will do with Jeep what they did with Ferrari. Spin it off, make lots of money and still have control.

    RAM aka Dodge trucks, are not trash. Any motor manufacturer would love to get their hands in on the lucrative U.S. truck market. Although, Sergio is giving them away, they are a serous money maker.

    Their mini-vans? Still the best selling. That is one area the domestic companies don’t even try anymore.

    FCA has large distribution network in both the U.S and Europe.

    IF, and a mighty big if, Mazda could come up with the money to buy the Jeep less FCA it could work. Sell Mazda’s through the formerly Chrysler stores, change Ram and mini vans back to Dodge and sell them through Dodge stores, use the FCA stores in Europe to sell Mazda’s. While selling Mazda’s smaller cars as Fiats. Sell off the rest of the brands to pay down debt. Or apply their quality to Alfa for the sports luxury market.

  • avatar
    th009

    To everyone suggesting that Toyota, Honda or Mazda should buy FCA (or even just Jeep), think back to the last time a Japanese company acquired a foreign auto manufacturer, and how that turned out.

    That’s right.

  • avatar
    Erikstrawn

    Why doesn’t Fiat/Chrysler follow Great Wall’s lead? Start trimming off the car market and roll Jeep and Ram into one brand – Jeep. Start selling Dodge Rams as Jeep Rams. Drop the Hellcats and Demons and start making Raptor competitors.

    Sell the rights to the remaining Dodge platforms to whoever is willing to pay – including the Pacifica. Take a write-off on the Charger/300 platform – you’ve made your money on it already. Move anything luxurious to Alfa and focus on improving the customer experience.

    Screw the dealers. It’s not like they’ve worked hard to keep people interested in your brand. I’m sure there are a few shining examples out there, but good luck finding them.

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