Last August, TTAC predicted the Chinese auto makers would start taking steps to edge their joint venture partners out of their market. And so today's International Herald Tribune reports that the Chinese government has "asked automakers to combine to compete with overseas rivals like Toyota and Volkswagen." To that end, China's largest auto maker has just announced that they're buying Nanjing Automotive Group's automotive assembly and parts-making businesses. Shanghai Automotive Industry Corporation (SAIC) currently has joint ventures with GM and VW. Nanjing owns the rights to the MG Rover brand– and is busy dumping their current joint venture with Fiat. There are no known plans to terminate any other joint ventures, but as SAIC strengthens its position in the Chinese auto market, they'll be looking to cut loose their foreign "partners." Count on it.
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Well, well, well, 2008 hasn’t even begun and the bad news keeps rolling in for GM.
GM are always making waves about their profitability and sales figures in China. Now, if they get kicked out, where will they get their profits from? Japan? Probably not. North America? Nope. Europe? Maybe.
The Chinese are starting to learn all they need to build cars properly. But someone people will say “But the Chinese are buying Buicks. All GM need to do is carry on selling Buicks and the customers will stay loyal”. That’s true, but the Chinese will eventually start designing cars which look like Buicks for loads cheaper. If their products start to look too much like their cars, GM can sue for copyright infringement. I mean, the Chinese respect copyright laws, don’t they……..?
If they expect to sell outside of China they will eventually have to respect intellectual property rights but not until then
In the long run…. don’t be surprised if GM is bought out by the Chinese.
The Chinese play to win, by any means necessary.
Also, their government is willing to support their domestic industries, unlike our government, which is content to see our manufacturing, engineering, and industrial base be hollowed out so that some can make a quick buck in the short term.
I wonder if there will be people who condemn the Chinese government for supporting their own industries?
I suppose if we could semi nationalize our auto companies and make the government part owner. Many if not most of the Chinese companies are either owned outright or partially by the government and military. Thats why their government supports their industry. We also support our car industries with subsidies. Its just that GM and Ford are run like crap and blow the money.
I guess we could nationalize our automakers . . . after all, look how well it worked out for British Leyland!
The more the Chinese govt. gets involved, the more likely that they’ll produce lousy cars. And making Yugos is no way to have even some sales in the US. Unsafe, polluting, low quality Chinese cars would pretty much unite every potential US buyer into avoiding them.
Of course, if you rip off the auto companies, you’ll encourage other industries to start deinvesting from China and head elsewhere. But totalitarian govt’s. can never resist interfering and making things worse.
Surely the Chinese wouldn’t milk us for our technology and money and then kick us out right??? GM and Ford tooled them up to build all the parts for all of their cars, trained their workers, helped pay for and construct the plants, handed them complete car designs, and simultaneously gave them a full handfull of the short curlies I mean put their US suppliers out of business.
Taxman100-I wonder if there will be people who condemn the Chinese government for supporting their own industries?
if by supporting you mean ignoring all IP laws, patents or safety regs then yes I condemn them.