Posted on 01/13/2010 6:43:49 AM PST by blam
Warren Buffett's Chinese Cars Will Start Killing The US Auto Industry As Soon As This Year
Vincent Fernando
Jan. 13, 2010, 7:12 AM
BYD, the upstart Chinese electric car maker Warren Buffett famously has an investment in, is planning enter the U.S. market as soon as the second half of this year.
Considering the U.S. market entrance by multiple new auto players (from Chinese firms BYD and Geely, to India's Tata and even U.S. upstart Tesla Motors) expect auto industry competition to get far more intense than it already is.
BYD just showed off their latest e6 model and while BYD chairman Wang Chuanfu was short on details, he hinted that BYD first target could be both U.S. companies' and the U.S. government's vehicle fleets:
WSJ: In China, where the e6 will first go on sale, BYD—which stands for Build Your Dreams—expects to sell vehicles for city use by the government, utility companies or fleets of taxis, according to Mr. Wang. BYD expects it could be used similarly in the U.S., while a later, plug-in hybrid vehicle may be more appropriate for individual American consumers.
[snip]
(Excerpt) Read more at businessinsider.com ...
Nope, no way. The Japanese intention was always to make excellent products. It was a matter of national pride for them to be able to emulate American quality and business practices, which were at that point the standard of the world.
China has no similar intention. None. I’ve been writing for years here about seeing first-hand in an electronics lab in 2000 how they deliberately remove necessary components from electronics designs (stolen or legitimately obtained) in order to save a penny here and there. It is absolutely shocking and is the explanation for why Chinese electronics fail miserably and quickly.
That was ten years ago and there’s been no improvement whatsoever. Japan on the other hand was starting from rubble in 1945 and had Deming on their soil by 1950.
How many articles do we see about China importing quality control specialists vs articles about China exporting cadmium bracelets, fake pharmaceuticals, poisoned pet food, etc.
And I don’t want to hear about how those are “exceptions”. An “exception” every month is a strategy, and it’s a national one.
You are correct, it was my mistake.
Ok let's have a few examples. Names we've heard, things we can buy. Stuff that's been around a while. And by the way, "SOMY" TV's and "CHISCO" routers don't count.
I agree. China is just a huge, cheap, labor pool.
Design, quality, marketing, etc. come from the company selling the product.
Its just easy for the head company to blame their Chinese manufacturing when something bad happens. The head company should have a periodic test program set-up for their own products. If the Chinese products don’t measure up to their specs they shouldn’t accept them.
Sorry. The UNIONS have ruined the auto industry here in America.
Making work and wages REASONABLE for employees is one thing. But the TRUTH is that the unions now suck the lifeblood out of companies. -Most of it to go to LEFTIST political purposes.
I worked union jobs for 20 years. I watched this all happen.
Uh....where are they going to get the electricity for all these cars? People won’t let the power companies build power plants as it is.
#18 & #34 are right on.
The Chinese WILL make cars for the world. Americans WILL buy them. They WILL be of high quality, in time. and they WILL decimate the US auto industry.
Automobiles are a COMMODITY just like any other widget. That America has not progressed past manufacturing 100 year old, gas burning, steel encased personal transportation is the problem.
The XKE was one of the finest cars in the world. The Vette killed it in every way. The classic Beetle and the BMW 3-series had and have been world class standards for many years. The Corolla and the Infiniti G series killed them.
I hate Buffet as much as the next guy, but the Chinese will take over the Auto industry, as we did after WWII and as the Japanese did during the 80’s.
“Flogging a Dead Horse” was not just a great post mortem listen, it is also a sign post for the US auto industry.
Get past the 100 year old tech, the old paradigm of bigger better faster stronger and make something really NEW! Compete and Beat the competition or go the way of the buggy whip.
“Just who is going to buy a chinese made car? I won’t.”
I have long predicted that brand spanking new Chinese cars will literally be on the shelves of Sam’s Club. Very small. Very basic. Priced competitively with a used car - around $8,000.
For a first time car buyer, new sounds better than used, and its easier to finance a new car.
The Chinese are kinda slim on labor costs. R & D costs...don’t really exist in China. They just copy other products.
Here’s the racket - if you want to sell cars in China, you have to form a partnership with a Chinese company. Through this ‘partnership’, the Chinese company gets access to all intellectual data. Eventually, a carbon copy of your car gets pumped out of Chinese factories. Its already happened with Saturn, several years ago - cars meant for the Chinese market.
Would Americans buy a Chinese car? We buy Chinese tv sets, tools, every damn consumable good at Wal Mart, etc. Oh yes, Americans will buy these.
Zero brags about having Warren Buffet on his economic team and here he is outsourcing car manufacturing to China.
If they don’t get in this way they will get in making parts.
When Warren Buffet was on Arnold’s team of adivsors he advocated raising the property tax. Arnold dropped him like a hot rock.
Interestingly, Deming was brought over to Japan primarily because of labor unrest; they wanted to figure out how to avoid unions and strikes and, with Deming’s help, instituted the work circles/quality concepts that actually achieved that goal AND inadvertently made their products appropriate for the growing American market.
The Chinese are very smart and a visit to a shop in any Chinatown in the U.S. illustrates their sales and marketing abilities. I suspect they will strive to correct the quality issues for a number of reasons.
A business friend of mine recently brought me up to date about the furniture manufacturing in China and a key component is the young peasants who come in from the country areas seeking work; they have to be taught everything and so there is still a great learning curve.
It took Japan several decades and so one can reasonably expect the same for China. I still maintain that they are too smart to stand firm on poor quality indefinitely.
Time will tell.
Jeez, I won’t ingest anything from china (Apple Juice, Garlic Powder, Shrimp) etc etc.
Pay good money to drive in something from there?
FORGET IT.
I bought a new tv last year and read on the back “Made in Mexico”
I was relieved.
Pretty frigging sad.
Nonsense. I'm pretty sure that American manufacturing can compete with anybody in the world. We just don't want them to. Unions and regulations strangle them.
Make something that delivers value for the price and it will succeed every time. Don't... and you deserve to fail.
No US industry can compete against workers in 3rd world countries willing to work for $1 a month.
I don’t care what the Chinese make or who chooses to buy their crap. Why I object to is forcing Americans to effectively subsidize Chinese industry through federal financing of unsustainable debt, burdensome business taxes and regulations, tolerance for illegal immigration while socializing its costs, and trade policies that ignore the effect of foreign tariffs on our exports while refusing to a sensible reciprocity. American industry is being purposefully strangled to support the interests of a few large transnational banks and companies whose interests and those of the federal government have become intertwined. This is not capitalism - it is fascism.
If the US worker isn't more productive, more skilled, doing higher quality work than somebody worth only $1 a month, then he needs to find something else to do. If I can be replaced by somebody halfway around the world doing my job better than I can do it, that's my own dumb fault.
It’s a crazy , mixed up world when buying a US car is spreading socialism in the US and buying a Chinese car is speading democracy in China.
......who is going to buy a chinese made car.....
Something like 52% of the American electorate voted for Obama and believe in the Utopian alternate energy concept. That includes the electric alternative to gasoline engines.
The small electric cars are special purpose for use in cities where distances traveled are short. Women will buy them. American women can be sold anything..... proof Oil Of Olay
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.