Stellantis, mother company of Jeep, just announced the “orderly termination” of its partnership with GAC. The Chinese automaker will no longer produce Jeep vehicles.

The said partnership allowed GAC to produce  Jeep models such as Renegade, Compass, Cherokee, and Grand Commander. However, according to Stellantis, the partnership which started in 2010 as FCA-GAC is making them lose money, instead of gaining profits. This is why a termination is necessary and appropriate. 

“We came to the conclusion that it was better to close the joint venture,” said a Stellantis spokesperson, adding that the venture had been loss-making and that the carmaker could still operate in China through its dealer network.

Fortunately, the termination will not cost Jeep to exit China. The brand will continue to operate by importing vehicleIs instead of manufacturing them locally.

In its 2030 business plan released in March, Stellantis already mentioned that it would adopt an “asset-light” business model in China. With this, it will increase revenue through imports rather than domestic production.

“The Jeep brand will continue to strengthen its product offering in China with an enhanced electrified line-up of imported vehicles,” Stellantis said.

GAC has already confirmed the issue through a statement on its website.

featured image courtesy of carwale.com