1/16/2008

Chinese cars are coming?

Not yet, but soon. That's the answer you get from the Detroit auto show.
There are simply too many problems for the auto makers in China to figure out before they can set foot on American soil. Yes, Chinese cars are relatively cheap (before Tata's $2500 motor car), but at what cost? safety, quality, service... And, apparently the Chinese automakers are not sincere about opening up the American market: they didn't even do their homework on English and PowerPoint! The fact is business in China are fighting for low price, not sophistication. Though they have improved productivity rapidly thanks to the vast investment in machinery, their marketing, sales, and after market services are still far behind American market standard. Finally, there's a Pacific Ocean of culture that the automakers have to overcome. They have to design cars specifically for American consumer, no less than a challenge to make cars.
However, if the Chinese are determined to thrust into the American market, undoubtedly world No.1, they will achieve it sooner or later. The best way is through M&A and outsourcing marketing, service, and R&D.
With the rising capital market in China, it's easier to finance the expansion of the auto industry overseas. Overall, this process will be quick. The Chinese auto industry is using Mao's rural surrounding urban model to improving its global position. New markets in developing countries will help China to acquire better knowledge soon.
No matter what, cars from China should be perceived as a pure gain for America as long as they are properly regulated by American agencies: 1. they will lower the price; 2. they will create jobs and opportunities in both countries; 3. they can absorb some of the huge surplus in the Chinese Treasury by for of state investment in the auto industry (better than pouring money into American financial asset alone).

1 comment:

Anonymous said...

"apparently the Chinese automakers are not sincere about opening up the American market: they didn't even do their homework on English and PowerPoint! "——别的我不了解,也不敢妄加评论,但显然经过几年较近距离的接触汽车企业,我敢说中国真正意义上的民营汽车企业已经没有那么多心情和精力花在做事情上了。在自己的家园里都得不到应有的政策和市场支持,还要时刻提防各种同根的或来自跨国企业的恶斗相残,再加上巨大的企业内耗,产业链问题,他们拿什么“实力”去参与国际竞争?!