China Motor Ends Partnership With Chrysler in Taiwan

Taipei, Sept. 3, 2010 (CENS)-- China Motor Corp. (CMC) in Taiwan, assembler of Mitsubishis and Chryslers, recently terminated its partnership with American carmaker Chrysler, which will soon shutter its auto assembly and sales business in Taiwan.

CMC, an affiliate of the Yulon Group and the largest carmaker in Taiwan, has been suffering losses since establishing a joint venture with Chrysler on the island in 2006.

Industry sources said that the partnership termination could be positive news for CMC, whose reinvested companies are expected to generate profits in the second half, except for Chrysler Taiwan.

Once a Big Three automaker in the U.S., Chrysler established Chrysler Taiwan with CMC in 2006 with initial capitalization of US$14.1 million, of which Chrysler owned 51% and CMC 49%. CMC assembled the Town & Country minivan on the island and sold both locally-made and imported Chryslers.

Chrysler Taiwan's sales have been flat in the past few years, totaling only about 2,000 vehicles (including about 1,400 Town & Countrys and some 600 imports) to the end of August 2010.

A senior executive of CMC said Chrysler Taiwan had bad luck because the operation right of Chrysler U.S. was transferred in 2007, plunging new-car sales suddenly in the same year.

As Chrysler's American headquarters try to find another local agent in Taiwan, CMC will continue to repair and maintain Chryslers in Taiwan.