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Here come Chinese cars (Detroit alert!)
Business Week ^ | 09 june 2005 | Business week

Posted on 06/11/2005 6:46:30 AM PDT by voletti

Korean cars gave Detroit fits in the late '90s by undercutting domestic small cars on price and outdoing them on quality -- then moving up into other segments. Autos from China could provide more lower-cost competition for the Big Three at a time when GM and Ford Motor Co. (F ) are already reeling. That could cost them, along with Chrysler (DCX ), more market share and prod them to move more of their own production offshore.

How fast can the Chinese gear up? The way things are going, it won't take 20 years to match Toyota Motor Corp. (TM ) quality levels, as it did for the Koreans. And with Chinese auto assembly workers earning $2 an hour -- vs. $22 in Korea and nearly $60 in the U.S. for wages and benefits -- it may not be long before China has the wherewithal to start selling competitively priced cars overseas. "The Chinese are probably five or six years away from being able to sell a competent low-end car," says auto analyst Maryann N. Keller.

The Chinese government is putting its heft behind the export push -- subsidizing the export drive of such local players as Chery and giving the likes of Honda big incentives. Beijing also is nudging foreign auto makers to divert investment into export production so local partners can become familiar with managing foreign-exchange risk and global supply chains. It's also pushing domestic companies such as Chery, Geely Auto, Brilliance China Automotive (CBA ), and Shanghai Automotive Industry to develop their own brands overseas.

(Excerpt) Read more at businessweek.com ...


TOPICS: Business/Economy; News/Current Events
KEYWORDS: automakers; china; turass
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Chinese cars, now? Yeah, the trade deficit with china isn't big enough yet, I guess.... Development costs are likely to be low since the chinese don't quite 'recognise' intellectual property rights the way we do. And dealership costs can be pared, by selling outta Wal-marts, I guess.
1 posted on 06/11/2005 6:46:30 AM PDT by voletti
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To: voletti

Can you imagine dealing with the Chinese about warranty issues? But then maybe they will build cars that have no problems.


2 posted on 06/11/2005 6:49:56 AM PDT by FreePaul
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To: voletti

The engine in the Chevy Equinox SUV is made in china.

Further, if the Chinese steal IP on cars, they will steal from Toyota, not ford or gm.


3 posted on 06/11/2005 6:50:43 AM PDT by staytrue
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To: FreePaul

....more donations to China's military machine....


4 posted on 06/11/2005 6:51:54 AM PDT by Loud Mime (Murderous Tyrants are NOT the Answer)
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To: FreePaul

"warranty issues"

I suspect the Chinese cars will be so cheap as to be nearly disposable.


5 posted on 06/11/2005 6:51:56 AM PDT by staytrue
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To: FreePaul
Can you imagine dealing with the Chinese about warranty issues? But then maybe they will build cars that have no problems

Noise? Car make no noise. You crazy. You think Chou sucker. Take car now! Go home. No come back.

6 posted on 06/11/2005 6:53:33 AM PDT by VeniVidiVici (In God We Trust. All Others We Monitor.)
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To: voletti

Yikes I've got 4 jokes already. None in too good of taste but let your mind wander.


7 posted on 06/11/2005 6:53:38 AM PDT by mad_as_he$$ (Never corner anything meaner than you. NSDQ)
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To: voletti
Well, you had better get used to it. The Chinese will build a quality car just like all the other name brand electronics and appliances on our shelves that is made there.

And with their labor costs, they'll murder General Motors and Ford.

8 posted on 06/11/2005 6:54:10 AM PDT by Dog Gone
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To: staytrue

Quality doesn't seem to be an issue with Chinese made goods. Scrap all you want. We'll make more.


9 posted on 06/11/2005 6:54:31 AM PDT by cripplecreek (Anyone who thinks we believe Hillary on any issue is truly a moron.)
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To: voletti
I'll never buy a car made by the Chi-coms with slave labor. They claim they pay the workers as much as $ 2 per hour. But how many of the workers are forced to work in these factories? Never again! Do not buy a product made in China.

Sometimes I walk through a Wal-Mart shaking my head at their really stupid display signs. How can Americans buy all that crap made in China and India? It ought to be a federal felony to shop at Wal-Mart.

10 posted on 06/11/2005 6:58:51 AM PDT by ex-Texan (Mathew 7:1 through 6)
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To: voletti

Our govt won't stop importing, til every American is out of work and on welfare.


11 posted on 06/11/2005 6:59:47 AM PDT by television is just wrong (http://hehttp://print.google.com/print/doc?articleidisblogs.blogspot.com/ (visit blogs, visit ads).)
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To: cripplecreek

from the article:

Honda says in-house quality tests show that the China-made Accord is actually superior to the one made in the U.S.


12 posted on 06/11/2005 7:02:09 AM PDT by staytrue
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To: television is just wrong
"Our govt won't stop importing, til every American is out of work and on welfare."


So, it's the US Dept. of Transportation that's buying the Chinese cars....and all along I thought it was John Doe in NYC and Fred Funk in Alabama.
13 posted on 06/11/2005 7:05:31 AM PDT by TRY ONE (NUKE the unborn gay whales!)
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To: television is just wrong

If you think about it "out of work and on welfare" equals under control.


14 posted on 06/11/2005 7:05:45 AM PDT by cripplecreek (Anyone who thinks we believe Hillary on any issue is truly a moron.)
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To: FreePaul

I am sick of all the GM basing (and American car company)I have seen on this forum. Let me tell you...America is forced to take cars made by people who work for a bowl of rice or in China's case slave/prisoner labor. However, they don't reciprocate and take our cars...there is no such thing as the free market. We open our markets and the other countries don't. If American companies complain to the WTC...they don't do anything because this organization hates America. American companies are forced to morve their operations to foreign countries where they can manufacture cheaply and compete. The cars are probably not going to be better...certainly the foreign made parts flooding this country are not better. This economy is fueled by debt right now...it won't last. When you see car companies in trouble look out...they are usually the first to feel a recession and the last to see a return to profitablility. GM is moving jobs to China-who can blame them? Those of you who bash Unions and car companies don't get it. The global economy will not-in the long run help American workers. A number of great American industries have been destroyed-steel industry, electronic industry and garment industry to name a few. A country that sells hamburgers to each other and manufactures nothing will not be a great economic power for longnor will its workers prosper. If there was a real free market between peer countries it might work...but there is too much of a difference between wages, work conditions etc. for this to ever work; however, it will be devastating to all American workers in the long run.


15 posted on 06/11/2005 7:08:17 AM PDT by nyconse
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To: All
This has been in the news for awhile: "US auto giant General Motors (GM) filed a lawsuit against China's [state owned] Chery Automobile Co for alleged piracy of a mini car developed by its South Korean affiliate Daewoo."

The Chi-coms stole your car and are selling it for about half you intended to charge, GM. Now they are going to sell it here in the U.S. I bet the Chinese pronounce Chery as Chevy -- they do that, ya know. Steal intellectual property and then market it using the victim's reputation.

BOHICA, GM!

Not to worry, the U.S. taxpayer-backed World Bank's Multilateral Investment Guarantee Agency (MIGA), the Ex-Im Bank, or any number of taxpayer-backed government programs will likely pay your losses, GM. That's what American "capitalists" call, good government interference!

16 posted on 06/11/2005 7:08:48 AM PDT by WilliamofCarmichael (Hillary is the she in shenanigans.)
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To: voletti

It's not the cheap labor abroad, it's the unions in America. The ultimate fate of any unionized industry is to be driven out of business by their non-unionized competitors.


17 posted on 06/11/2005 7:08:53 AM PDT by Jibaholic (The facts of life are conservative - Margaret Thatcher)
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Comment #18 Removed by Moderator

To: voletti

I used to feel guilty buying a Japanese car, not anymore.


19 posted on 06/11/2005 7:11:00 AM PDT by nairBResal
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To: voletti

Even as crappy as the quality on the usual rank and file vehicles coming from Detroit is these days, I hardly suspect any Chicom vehicles would pose any major threat.

They'll shrug it off like they did the Yugo and are doing to the Kia brand. You can't battle poor quality, fit and finish with pure crap.


20 posted on 06/11/2005 7:12:55 AM PDT by Buckeye Battle Cry (Life is too short to go through it clenched of sphincter and void of humor - it's okay to laugh.)
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To: Jibaholic
The ultimate fate of any unionized industry is to be driven out of business by their non-unionized competitors.

True, except in one important case: government. Free market economies can adjust to demand/output, while governments just continue to grow. The long-term public sector pension/healthcare benefits present a real danger.

21 posted on 06/11/2005 7:15:21 AM PDT by lemura
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To: Jibaholic

Yeah well please remember unions exist because of past injustices towards workers by business owners...I am married to a GM employee (management), we have seen the unions give concessions and then GM goes and cuts plants and employees anyway. The only reason the so called global economy is being sold to Americans is because of the union bashing that goes with it-divide and conquer.


22 posted on 06/11/2005 7:15:30 AM PDT by nyconse
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To: nairBResal

Japan thanks you....of course the 200, ooo GM employees who no longer have jobs since 1993 don't like you much.


23 posted on 06/11/2005 7:17:06 AM PDT by nyconse
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To: television is just wrong
Right on! It is all the same crapola coming from the GOP or the Dims today. They all support NAFTA and CAFTA. They are support open borders, motor voter, and vote by mail. Congress won't be happy until they give our Republic away to illegals crossing our borders. They support anybody stuffing money into their pockets. Today, that means foreign countries selling goods for less.

Americans will wake up one day and realize that they are out of work and no one cares any more. They will look at their expensive SUV's made overseas and just sh*t ! We are paying too much for oil. Why are we doing that? High oil prices raise the cost of goods everywhere in the U.S. from veggies to running shoes.

Pretty soon people will realize they paid too much for house they no longer can afford. When real estate goes upside down again in some sections of the country (and it will!) -- people will be forced to move to find work.

Read More About It Here

But nobody listens to me anyway. Just a geezer hiding in the Peoples Paradise of Portland. And considering registering as a Libertarian.

24 posted on 06/11/2005 7:22:53 AM PDT by ex-Texan (Mathew 7:1 through 6)
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To: ex-Texan

***It ought to be a federal felony to shop at Wal-Mart.***

Then check out the chinese goods at Dollar store.
Dollar General.
Dollar tree.
Fred's.
Attwoods.
Ace hardware.
True Value hardware.
Home Depot.

or any local Mom and Pop store.

You can run form the Chinese but you can't hide.


As 'Dilbert' said several years ago.
With slave labor you don't have to worry about the goods made of Friday not being up to standard.


25 posted on 06/11/2005 7:25:02 AM PDT by Ruy Dias de Bivar
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To: Buckeye Battle Cry
They'll shrug it off like they did the Yugo and are doing to the Kia brand. You can't battle poor quality, fit and finish with pure crap.

Say what you want about Kia, but I just hit 20k miles without any problems whatsoever. I could have spent twice as much for a Chevy Cavalier, but I'd be on my fourth or fifth warranty repair by now.

26 posted on 06/11/2005 7:25:06 AM PDT by AlaskaErik (Everyone should have a subject they are ignorant about. I choose professional corporate sports.)
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To: ex-Texan

libertarians, are open border too, but what ya gonna do.

Everyone puts down parties that are not open borders, and hates Americans who want to stop this ridiculous landslide we are all on.


27 posted on 06/11/2005 7:26:02 AM PDT by television is just wrong (http://hehttp://print.google.com/print/doc?articleidisblogs.blogspot.com/ (visit blogs, visit ads).)
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To: television is just wrong

Is there a party that supports closing our borders and enforcing the laws now on the books?


28 posted on 06/11/2005 7:31:55 AM PDT by ex-Texan (Mathew 7:1 through 6)
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To: ex-Texan

Pat Buchanan's party. Everyone hates him. Call him to Zeno phobic


29 posted on 06/11/2005 7:34:33 AM PDT by television is just wrong (http://hehttp://print.google.com/print/doc?articleidisblogs.blogspot.com/ (visit blogs, visit ads).)
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To: voletti

I can imagine how they'll handle warranty problems:

a.) You bring in car.

b.) Manager tells you nothing wrong with car.

c.) You insist something IS wrong with car.

d.) Manager flags tank which quickly rolls over you.

e.) Your former car is sold to another sucker.

No more warranty problems.


30 posted on 06/11/2005 7:41:10 AM PDT by Mad Mammoth
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To: Mad Mammoth
We contine to feed the Chinese war machine.

An American Expat in Southeast Asia

31 posted on 06/11/2005 7:44:33 AM PDT by expatguy (http://laotze.blogspot.com/)
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To: voletti

Yeah, think of the inherent cost advantage they get by pirating everybody else's technology.

Of course, no tree grows to the sky. As w/ Korea or Japan before them, their wages and standard of living will eventually rise to at least mitigate the current disparity.


32 posted on 06/11/2005 7:46:24 AM PDT by Pessimist
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To: nyconse

I disagree. I live 8 miles from the Chicago/Hegewisch Ford Plant, which builds the Five-Hundred, my neighbor is in management and told me these are the shoddiest made cars out of the 60 year old plant. Earlier this year, 3,ooo were scrapped after production because of multiple quality problems.

The American consumer will buy quality and reliable cars at a good price, that is why Toyota, Honda and Nissan continuosly show profits.

Protectionism, as some posters are suggesting, would result in that same Ford plant charging 50% more for the same crappy car. I remember the 1970s and early 80s well, when AMC and Chrysler went out of business (Carter bailed out Chrysler, I never agreed with it).

I don't want to pay 30 grand for a 4 cylinder GM/Ford sedan that will be in the junk yard 5 years after I drive it off the lot, and neither do most consumers. Don't blame the consumer.

If GM and Ford can't compete, that's their fault, not mine.


33 posted on 06/11/2005 7:47:38 AM PDT by wrathof59 ("to the Everlasting Glory of the Infantry".........Robert A Heinlein)
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To: ex-Texan
RE: Is there a party that supports closing our borders and enforcing the laws now on the books?

With some encouragement maybe the Minutemen Project will become a political party. They don't have to put candidates up against the legacy parties for every office, just when the legacy parties run candidates who favor migrant (legal or not) labor over citizens and laugh at our sovereignty.

34 posted on 06/11/2005 7:47:59 AM PDT by WilliamofCarmichael (Hillary is the she in shenanigans.)
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To: voletti

GM announced they were firing 25,000 peeps over the next few years. I think they are building auto manufacturing plants in China. Are they gonna hire 25,000 Chinese people to work at these plants?


35 posted on 06/11/2005 7:49:47 AM PDT by taxed2death (A few billion here, a few trillion there...we're all friends right?)
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To: ex-Texan
How can Americans buy all that crap made in China and India?

India's not the same as China --its a republic with regular elections not a communist state
36 posted on 06/11/2005 7:50:07 AM PDT by Cronos (Never forget 9/11)
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To: nyconse
"Japan thanks you....of course the 200, ooo GM employees who no longer have jobs since 1993 don't like you much."

Of course buying "American" isn't any guarantee your car is made here anyway. My wife drives an Escort (made in Mexico). She could have bought an Accord (made in Ohio).

How come the foreign auto makers can build here cost effectively and the US auto makers can't?
37 posted on 06/11/2005 7:52:22 AM PDT by Pessimist
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To: Cronos

Population wise, India is the world's largest Republic, a British influenced nation. Comparing them with China, as the other poster did, is ludicrous.


38 posted on 06/11/2005 7:53:19 AM PDT by wrathof59 ("to the Everlasting Glory of the Infantry".........Robert A Heinlein)
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To: voletti

Wow, I can't wait to see the owner's manual. Thank you for buying much joy car. Start engine train before safe drive. Install much memory when possible.

MM


39 posted on 06/11/2005 7:55:15 AM PDT by MississippiMan (Americans should not be sacrificed on the altar of political correctness.)
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To: nyconse
Reform of this country's labor laws (ie. A Federal Right to Work Law) should be number one in laws Republicans past to re-industrialize this country. Ideally, tax reform, and then looking at the subsidies foreign governments use.
40 posted on 06/11/2005 7:56:32 AM PDT by Last Dakotan
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To: Jibaholic

"And with Chinese auto assembly workers earning $2 an hour -- vs. $22 in Korea and nearly $60 in the U.S. "

--Hell, I don't even make 60$ an hour, i'd have to sell my body to make 60$ per hour, no one assembling cars should make that much!!


41 posted on 06/11/2005 7:59:52 AM PDT by 1FASTGLOCK45 (FreeRepublic: More fun than watching Dem'Rats drown like Turkeys in the rain! ! !)
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To: Last Dakotan

Tort reform and non-union shops would go a long way in re-industrializing the Great Lake States.

Having union protected alcoholics/addicts building cars and getting sued daily is not condusive to a productive environment.


42 posted on 06/11/2005 7:59:58 AM PDT by wrathof59 ("to the Everlasting Glory of the Infantry".........Robert A Heinlein)
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To: Cronos

China abandoned communism a long time ago.


43 posted on 06/11/2005 8:00:28 AM PDT by Dog Gone
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To: staytrue
Staytrue said:

"Further, if the Chinese steal IP on cars, they will steal from Toyota, not ford or gm."

That's redundant. Toyota obtained its tech foundation from GM, Ford, etc. In the 80s Toyota was to GM as Datsun was to Mercedes, etc. Open the hood of an old 280 Z and a six cylinder Mercedes of the same years. The similarity is amazing. If you worked on one brand you could work on the other brand with relatively minor variances.

The federal manufacturing standards for motor vehicle's pretty much limit how much variance the different brands are allowed between each other for a particular category. It comes down to consumer perceived quality and looks - both of which, (with a few exceptions) GM and Ford currently lack.
44 posted on 06/11/2005 8:00:44 AM PDT by Abogado (Cum catapultae proscriptae erunt tum soli proscripti catapultas habebunt)
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To: voletti

Power grows out of the barrel of a carburetor.


45 posted on 06/11/2005 8:01:04 AM PDT by LibWhacker
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To: AlaskaErik

"I just hit 20k miles without any problems whatsoever"

Screw them all, i'll just keep my Chevy PU with 1.2 million miles on it!

It's 40 years old but not really since I had it sidelined for 10 years.


46 posted on 06/11/2005 8:03:21 AM PDT by dalereed
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To: nyconse
...unions exist because of past injustices towards workers by business owners...

When? A hundred years ago? Some labor unions may have been founded because of worker mistreatment. Most labor unions exist today to concentrate power in the hands of crooks and thugs. Their main goal is to keep membership up by restricting productivity. Any "benefits" they get for the workers ultimately cost union jobs. Those areas where workers are free of union interference are thriving while forced union membership is killing industries in this country. The "concessions" given by unions don't put the cost of union labor in the fair market range and are usually accompanied by some other benefit which increases the cost of doing business.

47 posted on 06/11/2005 8:06:42 AM PDT by FreePaul
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To: mad_as_he$$

You all think this is kind of funny I think. I lost a manufacturing business to the Chinese. I had to pay worker's comp, and pay taxes on my employees. In China there is virtually no labor cost due to slave labor conditions.

Chinese will be mandatory in our public schools within a few years. Chinese will be the international language. The USA will be a 3rd world country. We are idiots for whoreing out our manufacturing wealth so we can shop at Walmart. We truly deserve this.


48 posted on 06/11/2005 8:09:23 AM PDT by goron
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To: Mad Mammoth
Mad Mammoth said:

I can imagine how they'll handle warranty problems:

a.) You bring in car.

b.) Manager tells you nothing wrong with car.

c.) You insist something IS wrong with car.

d.) Manager flags tank which quickly rolls over you.

e.) Your former car is sold to another sucker.

Uncanny: substitute the word "tank" with "the manufacturer's legal department" and its pretty much what is happening now.
49 posted on 06/11/2005 8:12:59 AM PDT by Abogado (Cum catapultae proscriptae erunt tum soli proscripti catapultas habebunt)
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To: nairBResal
I used to feel guilty buying a Japanese car, not anymore.

There was a time when buying an American car meant all of the part in the car were American made also.

Nafta changed all of that. So Amercian car components are imported from every place on the planet.

Just like illegal immigration American Cars have Illegal Immigration Parts making them not really American Cars anymore.

When that happened all bets were off on buy American and I also used to feel guilty buying a Japanese car, not anymore.

I will never buy anything from CHINA.

50 posted on 06/11/2005 8:13:35 AM PDT by Major_Risktaker
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