Stellantis said in a statement it had fully impaired the value of its investment in the joint venture in its results for the first half of 2022.
On October 31, 2022, Stellantis' China Jeep JV, which sold the Cherokee SUV and the Compass crossover, will file for bankruptcy. The venture between Stellantis and Guangzhou Automobile Group producing Jeep vehicles in China experienced a lengthy decline. Stellantis said in a statement it had fully impaired the value of its investment in the joint venture in its results for the first half of 2022. It also said it would continue to provide service to Jeep customers in China.
GAC, which approved the bankruptcy filing, said the joint venture had liabilities of almost 111 percent of its assets of CNY 7.3 billion (USD 1 billion). The company said the bankruptcy would not significantly impact GAC's operations in a stock exchange filing. Stellantis terminated the venture with GAC in July, only months after it said it would raise its stake in the business to 75 percent from 50 percent.
Sales for the venture, which sold the Jeep Cherokee SUV and the Compass crossover, have sharply declined for the past four years. Volume fell by 50 percent in 2021 from the previous year to 20,396 vehicles. For 2022, the JV sold fewer than 2,000 vehicles. In May, it reported selling only a single vehicle.