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The nerve! The pirates of Shanghai are knocking off entire motor vehicles.
Yahoo (Summary of Forbes Article) ^ | 29 January 2004 | Joann Muller

Posted on 01/30/2004 10:08:00 AM PST by shrinkermd

Piracy is such a way of life in China that people are surprised when a movie, software package or handbag bought there is not ripped off. Now you can add, to the list of counterfeit goods, passenger cars. Months before General Motors began selling its $7,500 Chevrolet Spark in China in December, a $6,000 knockoff version, the Chery QQ, with the same grinning front end but missing some subtle details (like an airbag), was cruising Chinese streets. Even more galling: The manufacturer of the pirated version was partially owned by GM's Chinese business partner.

Counterfeiting--usually just of parts--is driving carmakers crazy in China. Replacement parts like oil filters, headlamps, batteries, brake pads, fan belts, windshields and spark plugs, packaged with fake logos, are turning up all over the world, including the U.S. The carmakers say safety is at issue. GM says it has come across brake linings made of wood chips and cardboard that could burst into flames with heavy use and coolant that can eat through a car's radiator in 48 hours. Also very much at stake: profit margins. Replacement parts are to car companies what popcorn is to movie theaters. It's how they pay the rent.

Ford Motor says counterfeiting costs it $2 billion a year in sales. Counterfeiters are using computer scanners to duplicate trademark labels and slap them on fake goods, says Ed C. Wetter, manager of Ford's global brand protection program. Ford recently raided a Chinese factory and turned up 7,000 sets of counterfeit brake pads destined for Egypt, each stamped with a replica of Ford's blue oval. A legitimate set of pads for a Ford Taurus would cost the equivalent of $47 in Egypt; the phony ones might go for $30.

Manufacturers are stepping up their countermeasures worldwide. GM says it is investigating something like 400 counterfeiting schemes and seized or destroyed $180 million worth of counterfeit goods. But counterfeiters just move and reopen elsewhere, says Philip F. Murtaugh, chairman of GM China. What about jail sentences? In Taiwan, says Ford's Wetter, those few offenders sentenced to prison can reduce their terms for $30 per day. Lawsuits? Often a waste of time. Toyota recently lost a closely watched case in China against a Chinese engine manufacturer whose brand logo was nearly identical to Toyota's.

"Accepting this kind of practice in China is condemning China to remain an underdeveloped country," fumes Nissan Chief Executive Carlos Ghosn.

Still, going after the bad guys is tricky, given that the bad guys are often tight with the government, and the government is a business partner you don't want to offend. GM's trouble with the fake Spark probably had its roots in Korea, shortly before GM and other investors bought the assets of bankrupt Daewoo Motors in October 2002. The Spark is a replica of the Daewoo Matiz. One of GM's co-investors in Daewoo is Shanghai Automotive Industry Corp. Shanghai Autoalso happened to own a 20% stake in SAIC-Chery Automobile Co., a fledgling government-sponsored company that began producing cars in 2001. It is possible that Daewoo insiders sold the design specifications for the Matiz to Chery engineers before the sale to GM was final.

GM executives did not storm off to court about the fake car. Instead, they are in a parley with Chinese government officials.


TOPICS: Business/Economy; Culture/Society; Extended News; Foreign Affairs
KEYWORDS: automobile; china; stealing; trade; whole
Stealing is even cheaper than .60/hour.
1 posted on 01/30/2004 10:08:02 AM PST by shrinkermd
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To: shrinkermd
No airbag. This oughta be funny. (c8
2 posted on 01/30/2004 10:09:08 AM PST by Poohbah ("Would you mind not shooting at the thermonuclear weapons?" -- Maj. Vic Deakins, USAF)
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To: All
Now I know where Kucinich came from.
3 posted on 01/30/2004 10:18:49 AM PST by jigsaw (Freeper Fidelis)
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To: shrinkermd; struwwelpeter; VaBthang4
Ahhh...the old 'Nika' (instead of Nike) and 'Filla' (instead of Fila) shoes scams are now morphing into car scams. However i thought we would be seeing 'SmithenWesson' and 'Microssoft' before we saw 'Fcrd'(instead of Ford) and 'BWM' cars!!!!!

Talking about the BWM (instead of BMW) cars i do remember an April fools joke in Kenya where the newspapers printed some article that all BMW owners need to take their cars in for a check since approximately half of the cars were knock-offs from Taiwan. Since people knew about the whole 'Nika' shoe knock-offs they fell for the April fools joke hook, line and sinker. People had actually started dialing the BMW dealerships 24/7 before the papers confirmed the whole thing to be a joke.

4 posted on 01/30/2004 10:19:54 AM PST by spetznaz (Nuclear missiles: The ultimate Phallic symbol.)
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To: shrinkermd
The carmakers say safety is at issue.

Profitability is at issue.
5 posted on 01/30/2004 10:24:11 AM PST by aruanan
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To: shrinkermd
Only when large US corporations are getting their oxen gored will the feds listen. When it happens to the little guy, you might as well take a number and go sit down.
6 posted on 01/30/2004 10:29:39 AM PST by SpaceBar
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To: shrinkermd
The Chinese may be on to something if they began to reproduce the '55, '56. or 57' Chevy. The Chinese already make parts for the '47-'55 First Series Chevrolet trucks and it would be just an easy step to reproduce the entire truck. I would go for a repro '56 Bel Air in heartbeat priced at $7-10K.
7 posted on 01/30/2004 10:30:30 AM PST by vetvetdoug
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To: shrinkermd
I can't think of a group of people I'd rather see as victims than the big 3.
8 posted on 01/30/2004 10:38:09 AM PST by Last Dakotan
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To: SpaceBar
They wanted to ditch the US and play in China - well this is what they get and deserve!
9 posted on 01/30/2004 10:38:10 AM PST by KantianBurke (Principles, not blind loyalty)
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To: Poohbah
"GM says it has come across brake linings made of wood chips and cardboard"
10 posted on 01/30/2004 10:53:02 AM PST by NYFriend
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To: NYFriend
"GM says it has come across brake linings made of wood chips and cardboard"

Apparently the new environmentally friendly asbestos free version!
11 posted on 01/30/2004 11:01:38 AM PST by kaktuskid
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To: Last Dakotan
I can't think of a group of people I'd rather see as victims than the big 3.

And your real name is Ralph Nader, right? Parts counterfeiters cause accidents that hurt and kill people. Counterfeit parts have been a serious problem in the aircraft servicing industries. And you think this is OK?

12 posted on 01/30/2004 11:08:08 AM PST by toddst
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To: shrinkermd
The shameless and comprehensive nature of Chinese piracy brings to question why we do any business with them at all.
13 posted on 01/30/2004 12:01:32 PM PST by thoughtomator ("I will do whatever the Americans want because I saw what happened in Iraq, and I was afraid"-Qadafi)
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To: shrinkermd
Outsourcing is good for all. Glad to see this come back around to the manufacturers.
14 posted on 01/30/2004 12:22:05 PM PST by GingisK
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To: spetznaz
Wait a minute - are you implying my Rollix watch is...is...is a (sob!) fake?
15 posted on 01/30/2004 12:26:41 PM PST by Billthedrill
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To: shrinkermd
I had to do a paper on Mary Kay Cosmetics entering a foreign market. I could chose between Japan, China or Taiwan. In my summary I stated that if they went into China they should make sure they don't sell anything the don't want copied. I also stated to expect to be ''kicked out'' when the Chinese stole what they wanted. I six months after I did my paper I read in a marketing magazine that Mary Kay had been kicked out of China. They were considered a type of cult.
16 posted on 01/30/2004 12:27:33 PM PST by LauraJean (Fukai please pass the squid sauce)
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To: toddst
Aww come on, as if criticizing the American auto industry means I want to see people hurt or killed. Gimme a break.

Nobody but nobody did more to send American industry over to China than Ford and GM, including even forcing their vendors to set up shop there. I could care less that they are being stung by their short-sighted decisions

17 posted on 01/31/2004 8:58:59 PM PST by Last Dakotan
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To: Last Dakotan
Nobody but nobody did more to send American industry over to China than Ford and GM, including even forcing their vendors to set up shop there. I could care less that they are being stung by their short-sighted decisions.

I have no idea what Ford & GM have done per vendors and China. Vendors have to decide what they'll do to keep customer business.

My concern is the counterfeiting problem, especially as it impacts products here. The garbage produced by counterfeiters DOES cost lives and at the least is theft by deception.

I may pay more for a "genuine" GM part, but performance will sure exceed anything produced by Chinese counterfeit operators.

18 posted on 02/01/2004 7:39:33 AM PST by toddst
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To: vetvetdoug
The Chinese are doing a good job building Winchester M97 shotguns for the cowboy action shooting market. The are also making a M87 (Lever action shotgun - mega cool) and an external action shotgun.
Convince there's a market for old car reproductions and I think they'll do it.

I wish they'd make a repro Broomhandle Mauser in 9mm or .45.
19 posted on 02/01/2004 7:44:40 AM PST by Little Ray (Why settle for a Lesser Evil? Vote Cthuhlu for President!)
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To: vetvetdoug
The Chinese already make parts for the '47-'55 First Series Chevrolet trucks

Do you know where I can get some iron front fenders for one?

20 posted on 02/01/2004 7:54:30 AM PST by lewislynn
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To: shrinkermd
Gee, what happened to all that "free market", "fair trade" yammering from these big corporate guys?...Be careful what you wish for.
21 posted on 02/01/2004 7:58:12 AM PST by lewislynn
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To: shrinkermd
The manufacturer of the pirated version was partially owned by GM's Chinese business partner

Sleeping with the devil with dollar $ign$ in their eye$.

22 posted on 02/01/2004 8:00:16 AM PST by lewislynn
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To: vetvetdoug
"The Chinese already make parts for the '47-'55 First Series Chevrolet trucks and it would be just an easy step to reproduce the entire truck."

If you do not mind the fact that the parts are very thin and do not fit without serious work. I'd rather spend the hours beating the old stuff out.
23 posted on 02/01/2004 8:10:25 AM PST by Clay Moore
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To: toddst
I may pay more for a "genuine" GM part...

Me too.. but wait, I don't own any GM vehicles nor have I advised anybody to buy one for years. They make junk.

GM "owns" the list of cars to stay away from as posted by various consumer magazines. Probably has something to do with their purchasing the cheapest part sourced worldwide regardless of quality. That "Geniune GM" part you bought was probably made in the same factory as the knockoff, as the article testifies. As always - buyer beware.

24 posted on 02/01/2004 8:30:41 AM PST by Last Dakotan
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To: Last Dakotan
GM "owns" the list of cars to stay away from as posted by various consumer magazines. Probably has something to do with their purchasing the cheapest part sourced worldwide regardless of quality. That "Geniune GM" part you bought was probably made in the same factory as the knockoff, as the article testifies. As always - buyer beware.

Well, I don't make my automotive buying decisions based on consumer magazines. I've been buying and driving GM vehicles since age 17 and not had a bad one yet.

Per the "GM" part and its source, it doesn't matter to me IF that part comes through the GM network AND meets OEM standards.

Based on your comments It's clear you dislike American-based auto producers. Be my guest. I'll not get into a pissing contest with you. However, my comments about counterfeit parts stands - they are based on theft by deception AND create safety risks.

25 posted on 02/01/2004 8:58:57 AM PST by toddst
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To: lewislynn
If you subscribe to Classic Truck Magazine there is usually advertised original parts from a yard in Arizona. This junkyard has miles of old truck parts that have been kept in the desert and have minimal rust. I purchased some steel window pieces from them, they were excellent when buffed out but were not cheap. Brothers parts in Chino, California referred me to other junkers for parts that have been helpful.
26 posted on 02/01/2004 10:44:04 AM PST by vetvetdoug
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To: Clay Moore
Unfortunately, most of the fenders that I found for my First Series were rusted in various places and were in serious condition. By "cutting and pasting" from four trucks I finally got fenders for all sides, the spare wheel fender being the hardest to find along with the spare tire apparatus. Since I restored my '55 there has come on the market parts from Taiwan that are decent, especially the gas tanks, and I have replaced them on my truck. I have a dandy 55' First Series that made a photo piece about four years ago in Classic Truck and since it has been four years since restoration, I am having to replace little things like screws that rust and pay special attention to the original brake setup.

I would have to think real hard if I were to wreck my truck. Would I search out old fenders again or just buy the new reproduction steel ones from the little people? I hope I am not confronted with that dilema but in the meantime, I buy up old rustbuckets in barnyards for little when I am doing farm calls in the hopes I will have the spares when I may (hopefully never) need them.

27 posted on 02/01/2004 10:54:07 AM PST by vetvetdoug
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To: vetvetdoug
Keep the old parts. I built a '55 F100 back in the '80's. A van driver running about 80+ clipped me and ran me off the road. Wiped out clipped frame, LF fender, valance, bumper, 2 tires and wheels, damaged RF fender. Had less than 1K miles since frame up restoration.

I rebuilt it and drive it to this day.

I keep every little part now.
28 posted on 02/01/2004 3:04:17 PM PST by Clay Moore
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To: vetvetdoug
Thanks for the great info...
29 posted on 02/01/2004 7:06:57 PM PST by lewislynn
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