DaimlerChrysler sets van production venture in China

<p>DaimlerChrysler AG said the Chinese government has cleared its van production joint venture with two partners to make 40,000 vehicles a year in China starting in 2005.</p><p>The joint venture with China Motor Corp. and Fujian Motor Industry Group, due to be established in mid-2004, involves a total investment of about $245 million, DaimlerChrysler said Wednesday in a statement.</p><p>The German-U.S. automaker said it will make the Mercedes-Benz Sprinter, Vito and Viano models. The venture to be called DaimlerChrysler Vans China will be located in Fuzhou City.</p><p>Fujian will hold 50 percent of the joint venture. The other half will be held by DaimlerChrysler Vans Hong Kong Ltd., which is in a joint venture holding company of DaimlerChrysler and Taiwans China Motor Corp.</p><p>The van joint venture expands DaimlerChryslers position in the Chinese auto market. In September, the Stuttgart, Germany-based company signed a $1.22 billion deal with Beijing Automotive Industry Holding Co. to make its Mercedes-Benz cars and trucks in China.</p><p>In September, the auto company backed away from its plan to build a van assembly plant on a 1,500-acre tract 12 miles west of Savannah in Pooler, which had been expected to bring more than 3,000 jobs to the area.</p><p>Georgia spent $60 million to buy and prepare the site since last October, when then-Gov. Roy Barnes triumphantly announced the state had beaten South Carolina in DaimlerChryslers site selection process.</p><p>Barnes, a Democrat, lost his re-election bid just a few weeks later to Perdue, a Republican.</p><p>Analysts have said the automaker was not in a rush to build the new plant because it has an overcapacity in Europe and any increase in demand in the United States could be met by European excess.</p>