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Chery to build assembly plant in Catalonia

BARCELONA – The possibility of winning Chery’s European assembly plant has buoyed the spirits of the people of Catalonia, an autonomous region of northwest Spain whose capital is Barcelona.

A work group has been set up to detail where the plant could be located and what resources would be available to Chery if it comes here. The plant would employ 3,000 people, and create employment in the area of another 7,000 indirect jobs.

The Catalonian president, José Montilla, met on September 1 in Hefei, China, with Chery chairman Yin Tongyue and Wang Sanyun, governor of Anhui Province, and came away with an agreement to develop a proposal.

According to information published here, Chery intends to begin construction in 2012 of a €1 billion factory in Europe for small and medium cars. Output would begin in 2015, and capacity would be 300,000 units annually.

The plant would build cars for sale in Europe, North Africa and the Middle East, according to people involved in the negotiations.

According to one of the Catalan members of the president’s party that visited China, Yin Tongyue said, “I look forward to defending this Catalan project before the board.”

Two of the people who have been trying to attract Chery to Catalonia are Hong Kong businessman Bruno Wu, chairman of the Sun Media Investment Holding Group of Companies, and Pedro Nueno, professor of the IESE business school and chairman of the China Europe International Business School.

Nueno told reporters that Chery has effectively chosen Catalonia, and the only questions remaining are the exact location and what models would be assembled there.

A team from Chery visited Catalonia in September 2009. They met with president Montilla and toured the port of Barcelona, which would be key to Chery’s logistics on delivery to its markets, and design firm IDIADA (Applied Research Institute for Automobiles), which has Chinese customers.

The meeting in China reportedly lasted three hours. Chery outlined its needs, and the Spaniards presented their advantages, including the fact that suppliers in the area worked on the Seat Toledo, whose tooling was sold to Chery in 2000. Chery continues to sell vehicles based on that technology in China and eastern Europe. In addition, Chery in April signed Argentinian soccer star Leo Messi to be the international spokesman of its Riich brand, and Messi plays for the Barcelona soccer team.

The result of the meeting was a protocol of intent to study the feasibility of the proposed installation of a plant in Catalonia. The working group that will prepare a final draft of an agreement with Chery includes Nueno and Wu.

A government source told journalists that “Chery will choose Catalonia. We are convinced. But in China, business is done step by step. Until it is complete to the tiniest detail, it is not appropriate to announce anything.”

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