Chrysler to build Jeeps in China

January 14, 2013

Late in the 2012 political campaign, the Romney campaign ran an ad in Ohio that claimed the Chrysler Corporation was planning on building Jeeps in China.  This was a powerful charge in Ohio, where Jeep Grand Cherokees are manufactured.  Now, the Romney campaign did not claim that the Ohio lines were going to be shut down and that production shifted to China, but they did let that impression lie there.  The political media jumped on the ad, and self-appointed fact checkers called the ad “baseless.”  Indeed, Politifact later deemed the claim the “lie of the year.”

Today, it was announced by Chrysler that, yes, in fact, they are going to start building Jeeps in China (and in Russia).  They will not shut down the Ohio lines, and the Chinese Jeeps will be built to serve the local market, so one could claim that this will not have any impact on Ohio auto workers.  Until you look at the demand characteristics – the demand for SUVs has been declining in the US for several years, but SUVs – and Jeeps in particular – occupy a fast-growing niche in the Chinese auto market, soon to be the world’s largest.   So, any hope for the Ohio line to expand (or maybe even to survive in the long term) is dealt a serious blow when Chrysler opens up a new Jeep line in China.  Romney, it turns out, was factually correct both in the explicit claim and perhaps even in the implicit one.

Turns out that the “lie of the year” was actually calling Romney’s ad “the lie of the year.”


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