China Set To Become Top Automaker

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While global auto manufacturing is expected to rebound in 2010, China is expected to hold on to the top spot at least through 2013, iSuppli said.

By Antone Gonsalves
InformationWeek
March 27, 2009 04:00 AM

China, which last year surpassed the United States to become the second largest auto-making country, is poised this year to topple Japan as the world's top car producer, a market research firm said Thursday.

Chine is expected to build 8.7 million autos this year, compared to 7.6 million for Japan, iSuppli said. Last year, China automakers produced 9.3 million cars. That's 600,000 more autos than U.S. manufacturers. Most of Chinese cars are built for its domestic market.

"China's rise to the No. 2 position in global car manufacturing in 2008 marks a major milestone in China's economic ascendancy and the United States' industrial decline," iSuppli analyst Egil Juliussen said in a statement.

During the last five years, China has doubled automobile production, while U.S. manufacturing had fallen nearly 50%. Chinese automakers have benefited from the country's booming economy and the dramatic rise in disposable income of its consumers.

On the other hand, U.S. carmakers have suffered from increasing imports from Canada and Mexico under the North American Free Trade Agreement, as well as from imports from Europe and Asia, iSuppli said. Also, U.S. automakers have outsourced a major portion of their car manufacturing for the domestic market to Canada and Mexico. In 2003, U.S. carmakers built nearly three autos for every one produced in China.

China's production numbers consist of passenger cars and light trucks from domestic companies and joint ventures between Chinese and foreign automakers. The multinational companies build about 50% of the autos in China. Foreign auto brands that are leading auto sellers in China include Volkswagen, General Motors,Toyota (NYSE: TM) and Honda.

However, China is not immune from the impact of the global economic downturn. Car production is expected to decline by 6.5% this year. Nevertheless, the country will outperform the overall global market, which is expected to follow by 25.1%, iSuppli said.

Japan surpassed the United States in 2006 to become the world's largest car producer, with 55% of its production going overseas. Despite falling auto sales last year, Japan barely reduced production, generating a major excess in inventory that will force Japan to dramatically cut production this year.

"The result is that China will have the lowest production cutback of any nation and will become the auto production leader in 2009," Juliussen said.

While global auto manufacturing is expected to rebound in 2010, China is expected to hold on to the top spot at least through 2013, iSuppli said.

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Chinese head bids for Volvo



Ford has admitted that several Chinese car companies are interested in buying Volvo – and revealed that no Western car makers are in the running to acquire the Swedish company.

Ford has been talking to what it describes as “a number of interested parties”, and has taken these talks to a new, more detailed level to discuss how Volvo could be separated from its parent company.

“A couple of the frontrunners are Chinese car firms,” a highly placed Ford insider told Autocar today. One of these companies is Geely, China’s first privately owned car firm, which is known to be keen to expand its influence beyond China and other developing markets. But none of the interested parties is a Western car manufacturer.

As it did with Jaguar and Land Rover, Ford wants the future owner of Volvo to demonstrate that it understands the culture of the company and would respect Volvo’s uniquely Swedish nature.

Many estimates of the price Ford would take for Volvo are wildly inaccurate, according to the source. “The $6bn (£4.1bn) that has been suggested is too high; we’d be expecting less than Tata paid for Jaguar Land Rover, because Volvo is not profitable and we’re in a recession. Around $1.2bn (£820m) is more accurate.”

The Ford insider also said that this is only the start of a process that could take over a year to conclude. "It could take as long as the JLR deal, and is unlikely to be before the end of the year.”

When Autocar contacted Ford, spokesman John Gardiner would only say that the company was in talks with "a number of interested parties."

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First Chinese-brand cars arrive in Australia



THE first Chinese-brand vehicles to be sold in Australia will be in dealerships by mid-year when a local importer begins shipping in two workhorse utes made by Chinese carmaker Great Wall.

About 50 dealers will offer two models from the privately owned Chinese maker with starting prices under $20,000.

Independent vehicle importer Ateco Automotive expects to sell a couple of hundred a month and has spent four years working on the deal.

The models, called Wingle and Sailor in China, will bear alpha-numeric names here and are just the beginning for Chinese car imports, according to Ateco managing director Ric Hull.

Mr Hull made more than 20 trips to China to select potential suppliers and whittled the list down to Great Wall and Chery, which supplied hybrid cars for the recent Beijing Olympic Games.

"Chery was an obvious pick because they're the largest of the independents," he said. "We ended up with Great Wall because we like them, their products and how they do business."

Great Wall, based in Baoding, south of Beijing, already exports to 120 countries in Asia, Europe, Africa and Eastern Europe.

The Great Wall utes were originally due on sale late last year but Ateco postponed the launch after exchange rates moved against the Australian dollar.

Ateco chief Neville Crichton said China's car industry was ambitious but pragmatic.

"They want to be No 1 in the world eventually, like they are with whitegoods and televisions and every other appliance," he said. "But they're realistic about where the product should sit and how much time it could take to become a major player."

He was impressed by the pace of industrial and infrastructure development in the country.

"Every time you went back things were vastly improved -- from the roads, to the manufacturing plant and office blocks. Everything's new and immaculate," he said.

Mr Hull said crash safety issues, which sank early attempts to export Chinese vehicles to Europe, had been overcome with internal testing by the companies to international standards.

The Great Wall utes will be the first Chinese-brand vehicles ever sold in Australia, although not the first Chinese-made cars.

In recent years Volkswagen sourced some Polo small sedans from its Chinese factory for sale here on a trial basis.

[hk20000]

zup China lover. When posting these posts can you post up a link too? thanks.

[El Bastardo]

Oh shit. We all gonna die.

[Ludepower]

China rapidly taking over the world. Before you make fun of their quality...Korean and Japanese cars started from shit also.

[El Bastardo]

Korea and Japan never made fake milk and fake eggs

[Iceman_2K]

you know that fake egg and fake milk are also produced in other parts of the world too right? Like, even in the US, its made and used too?

[BoneThug]

:rofl as if anyone would buy a car from china

[dna82]

Originally Posted by Ludepower

China rapidly taking over the world. Before you make fun of their quality...Korean and Japanese cars started from shit also.

yeah well, gloat in 20 years, for now. shit cars are still shit.

[!LittleDragon]

Originally Posted by dna82

yeah well, gloat in 20 years, for now. shit cars are still shit.

No, building and exporting cars for sale, that'd be the hard way... the easy way would be to buy up the ailing automakers like GM, Chrysler, Nissan, Fiat, etc... You think a brand called Great Wall will sell over here? People will buy what they're familiar with. It'll be like when Lenovo took over IBM's computer business, people still buy it despite being Chinese owned. I don't think they'll sell their cars here, they'll get your money by buying car companies that you will buy from.

[Synaptik]

technology transfers and brand takeovers are china's ways of leapfrogging decades of r&d.

when these companies pick up momentum even toyota won't know what hit them.

[m4k4v4li]

Originally Posted by BoneThug

:rofl as if anyone would buy a car from china

no kidding! thats crazy talk having china manufacture products, everything they make is shit.

[shenmecar]

Originally Posted by 6chr0nic4

no kidding! thats crazy talk having china manufacture products, everything they make is shit.

or contain toxic ingredients, ie. melamine!

[PavelGTR]

Originally Posted by 6chr0nic4

no kidding! thats crazy talk having china manufacture products, everything they make is shit.

lol

[slammer111]

Remember, China isn't more than about 40 years behind the US in terms of technology, and that gap is closing fast. It wasn't that long ago when people were making "bad" products (ask your parents about glow-in-the-dark toys from the 50s and 60s) on this side of the world. And while you hear about poorly-made Chinese products, even if that was 30% of their total output, don't forget that the other 70% is decent quality and you don't even know it's from there.

I hate to say it, but any country who underestimates China is gonna get their asses kicked in the not-so-far future. Look at Korea in the 80s, and look at them now.

[orange7]

haha.. maybe china will buy out the detroit's big three..

haha.. now that would be epic

[El Bastardo]

Blah blah blah, I know I came off like an asshole earlier in this thread but look at it this way:

Some Chinese companies have had the benefit of 50~ years of modern safety R&D done on other companies' dollars and have done little to heed their warning. Since Ralph Nader's critique of domestic auto in the book "Unsafe At Any Speed" automotive safety has been in the public eye and is a consideration some potential buyers make before purchasing a car.

From what I've read there is a strong following for foreign autos in China and I honestly believe that safety has some hand in that. Why, then, would an auto industry that has access to a huge portion of the planet's population (and their wallets) not have a majority stake in their nation's safety on the road? I have no idea.

[youtube]5kQGAK550LE[/youtube]

That is the Chery Amulet. A Chinese made auto. And thats fucking terrifying.