Posted on 03/20/2005 5:02:54 PM PST by HAL9000
SHANGHAI, March 20 (Xinhuanet) -- China will become world's biggest auto manufacturing center worldwide in the next three to five years, said leading European consultant organization Capgemini.International auto companies cannot wait for a share the cake, said Peter Kroll, vice president of Capgemini.
General Motors, Volkswagon, Toyota and Nissan are busy establishing their manufacturing bases in the vast and low-cost Chinese market. Kroll said China has attracted 60 to 80 percent ofthese companies' total investment in the international market.
"Whether or not they can gain a success in China will be decisive to the future development of the auto giants," Kroll said.
Many transnational companies have chosen to close down the car factories in their own countries and transfer them to China, meaning China will also become a huge source of car export. Kroll said.
On the other hand, the potential of China's own auto consumption market is great, Kroll added.
Despite having a per captia 1,000 US dollar GDP, China's risingmiddle class has shown increasing purchasing power. He predicted that China's auto consumption will grow, prices decline and the loans and lease services become more widespread.
Surveys conducted by Capgemini show that the psychic and tastesof Chinese auto buyers are somewhat different from the consumers in other countries.
Kroll said Chinese consumers buy new cars not secondhand ones. When they decide to but a car, they prefer to listen to the adviceof family members, friends and colleagues instead of reading related publications or receiving professional evaluation services.
Few Chinese buyers show devotion to a particular brand. They seldom buy the same cars from the same retailer, Kroll said.
Also, 70 percent of the Chinese consumers are first-time car buyers, which means a huge commercial opportunity, said Kroll.
China's entry into the World Trade Organization (WTO) has brought a sharp fall of car taxes. Chinese consumers have great expectations for prices of both imported and domestic-made cars, said Kroll. Many people are now taking a wait-and-see attitude, bringing big pressures to the auto market.
The growing production material costs and higher oil prices complicate the auto industry as a whole.
Kroll said many local auto makers must quickly respond to the question: how will they keep and develop their own brands during the cooperation and competition with the transnational giants?
To solve the problem, he advised Chinese auto makers to learn from the experience of the their Eastern Europeans, who faced the same difficulties ten years ago.
Kroll said the Romanian Dacia auto company is a successful example. It managed to optimize the design, improve quality and cut costs of their own cars with the help of their cooperator Renault's technological platform, management experience and sale network. Not only have they kept the brands, but also seized a larger market share in the country. Enditem
Looks like Wal-Mart auto centers are gonna need more shelf space. And an adjacent finance company.
Based upon this information, the UAW will love this. Who is going to be purchasing these autos if no one is working?
Billions of Chinese cars' polluting emmisions will melt the polar ice-caps worldwide?
/Global warming?
sure, the Chinese auto market will grow and be significant. But anyone who thinks the chicoms are going to allow the average chinese factory worker to drive around the countryside in an automobile, is nuts. their wage levels will never rise for the broad majority of their population.
the real game here - the auto companies building capacity in china, who CLAIM its for the chinese market, really want to build that capacity there so they can manufacture auto subassemblies and entire cars in china for other markets. the engine in the new Chevy Equinox is made in china, if demand in china is so strong, you would think that every engine they make would go towards domestic chinese consumption - so why do they have all these engines to place into vehicles sitting on US chevy lots?
Well the Chinese have already proven themslves over time.
They invented fireworks, spaghetti, and puzzle boxes.
We are in trouble now!
Muleteam1
Also, the term Chicom needs to be updated. They're no longer a communist government. They're more of a fascist state now -- increasingly capitalist economy with an nationalistic elite (who pretend to be socialist) at the top. Perhaps, ChiNazi would be more appropriate.
With 1.3 BILLION people, they should.
It's also interesting to note that only Toyota is really healthy and innovative of the four big investors. GM is no longer really competitive in the US and is surviving on financial profits and profits in the lower quality markets overseas. Nissan is a big mess both in Japan and the US. Volkswagon is okay but it's not exactly a world-beater. My guess is that only Toyota will do well in China. The other three will be taken to the cleaners by domestic Chinese competition.
| China to become world biggest auto making center
I do not believe this can happen in the next 3 to 5 years, as the article states. Ten maybe, more likely 15 or 20. There's more to making cars than car factories. Where do they get the steel? Where do they get the energy to run the steel mills? How do they transport the energy from where it is to where the steel mills are? You can't just flick a switch and make all that stuff happen. |
I wonder if these commie-built abominations will get better mileage than the wretched POS Trabant.
Do you think that all these companies will even gat a "thank you", when China decides to nationalize those factories GM, Mercedes, and Toyota built?
Grand Prix - March 19, 2005 - Chinese to rescue Fiat Auto?
I think the Chinese are determined to enter the U.S. market. It's not implausible that they could try a takeover bid on GM, Ford, etc.
And then have those plants make tanksplanes, missiles, etc....
The UAW is the reason US manufacturers are moving their production plants to China. They don't have union workers pushing them to the brink of bankruptcy over here.
I guess it doesn't matter, if you don't fear the thought of foreign overlords. We just need to buy into the program early, right Nick? And if you ever come up with a "plan B" to compliment your prediction they will collapse from the weight of their own growing industrialism, please be sure and let us know. Thnx.
So your plan is to keep the third world in a perpetual state of pre-industrialization? Good luck.
I think GM started to build their plant over there 2-3 years ago. I read about it in a car mag about that time.
I think the article also said it was going to be the largest plant in the entire world.
The USA burns 45% of the world's gasoline. For the time being. The White House look at the fallout of $4 gasoline may not be much ahead of the actual events.
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China is probably going to become the "world's biggest" everything, just because they have all those people. So what? Beyond a certain point, economies of scale flatline, or in some cases even turn back upwards. So there's no reason to think they can mow everybody down with scale economies.