Is China’s Great Wall Motors going to become the biggest SUV manufacturer in the world?
Earlier this month we heard that an unnamed Chinese automaker attempted to buy Fiat Chrysler and now we have rumors that another Chinese giant is trying to do the same with another company. We know for sure that Dongfeng and Geely aren’t interested in any of this since they officially denied the involvement. On the other hand, Great Wall Motors claims that they would rather opt for the Jeep as one brand rather than buying the whole of FCA.
The Chinese revealed that they have already approached FCA and will try to negotiate and buy Jeep. Xu Hui, a Great Wall spokesperson said: ‘We are deeply interested in the Jeep brand and have paid close attention to it for a long time. Our strategic goal is to become the world’s largest SUV maker. Acquiring Jeep, a global SUV brand, would enable us to achieve our goal sooner and better.’
The only thing left to be seen now is whether Sergio Marchionne, FCA’s CEO, can be persuaded to sell one of its most valuable assets. If we were to believe Morgan Stanley analyst Adam Jonas, Jeep on its own is worth more than FCA as a whole. Marchionne claimed in April how he would be interested in turning Jeep into a company of its own and we gather that this purchase is maybe possible. However it is estimated that Jeep is worth $33.5 billion according to Jonas, so a question is raised – can a company that generates less than $15 billion in revenue raise the necessary money to buy Jeep? What if another automaker steps in and outbids Great Wall?
Nowadays, however, all of this is just a prediction or better yet a rumor. Guys from FCA claim that Great Wall hasn’t actually approached it about Jeep. They haven’t approached FCA about anything business related. If that happens, we’ll truly see how attached Marchionne is to Jeep.
