- The Washington Times - Tuesday, February 24, 2009

UPDATED:

SHANGHAI

Officials at Chrysler LLC and Chinese carmaker Beijing Automotive Industry Holding Corp. refused to comment Monday on a report that the Chinese corporation might bid for assets of Chrysler LLC.

The state-run newspaper China Business News, citing an unnamed Beijing Auto executive, said Beijing Automotive wanted to acquire Chrysler assets using a similar approach to that taken by Nanjing Automobile (Group) Corp. when it bought defunct automaker MG Rover Group.

The aim, China Business News said, was to acquire production facilities and technology to build up Beijing Auto’s own brand vehicles. The Beijing city government might also provide support for such a deal, it said.

Staff at Beijing Auto’s headquarters in Beijing, however, refused comment Monday.

“Oh, I know what you are calling for, but it is not convenient to answer that question,” said Jiang Wei, a staffer in the company’s publicity department.

David Elshoff, spokesman for the Auburn Hills, Mich.-based Chrysler, also refused comment in an e-mail message.

“Chrysler does not comment on rumors or speculation, nor does it confirm or disclose the nature of its private discussions,” Mr. Elshoff wrote Monday.

But his message pointed out that Chrysler has identified more than $1 billion worth of “non-earning” assets it wants to sell, and it has completed selling $700 million worth. The company’s viability plan submitted to justify its $4 billion in U.S. government loans says that Chrysler plans to sell the remaining $300 million in assets, Mr. Elshoff wrote.

An asset sale to Beijing Auto could give it the ability to make and sell an older-model Chrysler in China. Chrysler in 2006 sold machinery to make the previous generation Sebring sedan to Russian automaker GAZ Group, which now builds the car under a licensing agreement with Chrysler for sale in Russia.

Like other Chinese automakers, Beijing Auto is keen to build up a globally competitive brand name. Its chairman, Xu Heyi, has expressed interest in fortifying the company through acquisitions and mergers.

In 1984, Beijing Auto was the local partner in China’s first automaking joint venture, with American Motor Corp., Beijing Jeep Corp.

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