22.07.2025 18:08
A major automotive partnership established in China with great hopes, which achieved annual sales figures exceeding 200,000, has ended in bankruptcy. The 15-year partnership between Fiat Chrysler and GAC has officially come to an end with a court ruling. Here are the details of the news...
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Fiat Chrysler Automobiles (FCA) and the Chinese automotive giant Guangzhou Automobile Group Co., Ltd (GAC) officially ended their partnership, which was established 15 years ago with great hopes. The GAC-FCA joint venture, which once made a rapid rise in the Chinese automotive market and broke production records, was declared bankrupt by the Changsha Intermediate People's Court in Hunan Province, China.
The court ruled on July 8, 2025, that the company could not restructure its debts and approved the bankruptcy application. The decision came after years of financial turmoil and unresolved structural crises.
IT HAD STARTED PRODUCTION WITH GREAT HOPES
The joint venture, established in March 2010 under the name "GAC Fiat," began operations with an investment of approximately 17 billion yuan (about 2.3 billion dollars). China's status as the world's largest automotive market turned this investment into a strategic move on a global scale. Entering the market with localized Fiat models such as Viaggio and Freemont, GAC-Fiat achieved positive growth momentum in its early years.
IT ACHIEVED RECORD SALES IN 2015
The partnership was rebranded as "GAC-FCA" in 2015 and shifted its focus to the Jeep brand. That same year, the first Jeep Cherokee produced in China rolled off the assembly line. This change quickly boosted the company's sales. In 2017, sales exceeded 205,000 units, setting a record, and GAC-FCA earned the title of China's fastest-growing joint venture car manufacturer.
THE CRISIS COULD NOT BE RESOLVED
However, this success was short-lived. Sales fell to 125,000 units in 2018 and continued to decline each year. By 2021, sales had dropped to just 20,000 units. Even the total cash injections of 4 billion yuan (approximately 580 million dollars) made by the partners could not stop this decline.
The breaking point occurred in 2022. FCA's parent company Stellantis announced that it wanted to increase its stake in the partnership from 50% to 75% without GAC's approval. GAC explicitly rejected this move, deeming it unauthorized. The crisis brought the relationship to the brink of collapse. In July 2022, both parties announced that the joint venture had officially ended.
OFFICIALLY BANKRUPT AFTER 3 YEARS
With the end of the partnership, Jeep production in China ceased, and Stellantis began to offer the Jeep brand in the market solely through imports. After three years of uncertainty and legal processes, the bankruptcy of GAC-FCA was also officially announced.
Starting with high expectations, rising with records, and shaken by strategic mistakes, the GAC-FCA partnership has gone down in history as a striking example of the challenging structure of the Chinese automotive market and the risks it poses for foreign brands.
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