GAC Fiat Chrysler Joint Venture Declared Bankrupt in China

GAC Fiat Chrysler Automobiles, the joint venture between Stellantis and Guangzhou Automobile Group (GAC), has been officially declared bankrupt by a Chinese court due to insufficient assets to cover liabilities and failure to restructure. Founded in 2010 with a total investment of around CNY 17 billion (US$ 2.4 billion), the venture produced Jeep SUVs and other Chrysler models but struggled with declining sales after peaking in 2017. The company faced challenges including mounting customer complaints, intense competition from Chinese electric vehicle manufacturers, and a lack of investor interest, leading to a failed restructuring process that lasted nearly three years. Attempts to auction core assets, such as factories and equipment, were unsuccessful because of the need for substantial investment to convert production lines from fossil fuel vehicles to electric, reflecting China's shift toward electrification. The joint venture's collapse also followed tensions between the partners, particularly after Stellantis sought to take full control, which GAC rejected. This bankruptcy marks the definitive end of efforts to establish a strong presence for Stellantis brands in the Chinese market.