Chrysler looks at auto alliance with Chinese

Chrysler, the smallest of the three major U.S. automakers, is trying to expand sales in the fast-growing Chinese market and has a deal with China's Chery Automobile Co. to produce a low-cost model for sale under its Dodge brand.

Under the new agreement, Chrysler and Great Wall will look at ways to use each other's distribution networks and component and technology capabilities, Chrysler said in a statement released in the United States.

The agreement "represents part of Chrysler's ongoing efforts to explore opportunities to expand the company's involvement in the development of China's auto industry, as well as growing Chrysler's global business through the right partnerships," Chrysler spokeswoman Shawn Morgan said in the statement.

Morgan said the companies were not releasing any more details.

The agreement comes as American automakers look to China to drive sales at a time of slumping U.S. demand. China's own young but ambitious producers are looking at foreign partnerships to improve their technology and marketing.

Great Wall, based in Baoding, a city west of Beijing, is best known as a producer of SUVs and trucks but is expanding into cars.

Chrysler, in Auburn Hills, Michigan, says sales through the first five months of this year are down 19 percent from the same period last year. The company has denied rumors it is close to seeking bankruptcy court protection.