Forbes reports GM is creating a China Science Lab at its Shanghai manufacturing facilities where development work will take place on advanced vehicle technologies. GM won’t disclose the extent of its investment in the lab, but has said it will hire 100 employees from China and abroad to form the initial staff. John Du, the former manager of Intel’s China Research Center, will supervise work at the new lab, which will focus on “advanced engine technology, battery cells, safety research, driverless vehicles and light materials.” Which begs the question, has anyone told the Michigan Economic Development Corporation about this? Seriously, this seems like exactly the kind of high tech, green-jobs opportunity that Michigan’s politicians are constantly giving GM massive tax breaks for. Not to mention the raft of federal incentives, bailouts and green car-development initiatives. But, as GM’s Alan Taub puts it, “China has begun emerging as a world class research hub for automotive technology.” That and China has begun emerging as the only thing keeping GM going. Er, except for our federal incentives, bailouts and green car-development initiatives.
“China has begun emerging as a cost effective research hub for automotive technology.”
Fixed, I put the correct PC BS there.
Now removing my own PC BS, read cost effective as cheap.
GM has every right to morph into a Chinese company if they want to, but they shouldn’t be doing it with US taxpayer money.
Cost effective = cheap, once upon a time the same thing was said about Japan, Korea and Tiawan, look how that turned out.
I’m not judging on quality. Let’s see the engineer’s wage:
US/EU >>>>>>>>>>>>>>> China
Can anyone tell of what is left for America to make or do in a cost-effective manner….other than service-sector jobs? I mean what might we do that would have our balance of payments balance? Yes, airplanes (thanks, Boeing), but even there the Chinese are laying plans for that sector.
While healthcare reform is very, very important, it’s all rather pointless if there is no employment.
The preceding decade was a killer success for the rich, but everybody else just marched in place. Now we are shedding jobs, but the economy has “recovered”. Even at IBM, employing Americans doesn’t seem to “make sense” to the management. And if IBM is giving to push to long-time employees who are brilliant, experienced, wise and hard-working, what is the point of retraining for high-tech? Witness this piece.
Just asking…and trying to be realistic and non-political…
rnc :
September 24th, 2009 at 12:37 pm
Cost effective = cheap, once upon a time the same thing was said about Japan, Korea and Tiawan, look how that turned out.
It’s “Taiwan.”
Korea and Japan’s auto industry didn’t cut it’s teeth by simply copying other cars verbatim.
Rational use of capital vs long term national interests. We have tended towards the former at the expense of the later for decades to our detriment. Combine this with an “everything is free” credit environment for both citizens and government, and it is no wonder we are in this mess.
verbatim that’s exactly what Korea did. verbatim that’s what everyone does now, there’s only so much you can do with a car and any successful design/style is emulated.
Korea and Japan’s auto industry didn’t cut it’s teeth by simply copying other cars verbatim.
I believe the first Toyota in the 30s was a copy of a Chrysler Airstream with a copy of a chevy 6 cyl drivetrain. At least according to the Toyota Museum. You don’t think Hyundai copied Toyota?
So if we’re not even going to engineer the vehicles and technologies here in the US then what’s the argument against the transplants again?
Driverless vehicles, eh? Sounds like they’re tooling up to supply GM management.
@Stewart Dean
well, america has to become more competitive, you have to work more, get less paid …
the standard of living and wages are going to
balance worldwide, so it wont be important if you live in the US or china. in other words, the standard of living for americans will have to fall. thats inevitable, wheter you (americans) like it or not.
for instance, car pooling will become a common thing, no more easy and cheap credit…
p.s. btw, boeing is still #1, but others are closing in, look at the new sukhoi 1000 passenger plane (yes they make pass. planes as well) or Embraer (a brasilian company making small to big passenger planes, basically a gulfstream competitor for half the price …)
Well, the Chinese are the masters when it comes to making cheap, under-engineered junk. I suppose then that General Motors will find itself feeling quite at home there.
To qualify my statement – Visit a Wal-mart. Everything in there, all the cheap dreck that lines the shelves at wallyworld, came over on a boat from china. Look at what crap it all is. GM is the Walmart of cars to begin with so this move should come as no surprise.
And when I say that GM is like Walmart I mean that they both sell cheap, mediocre junk that is not worth having.
re:european – I agree that the standard of living in the US has to come down, thankfully. No more being decadent sloths, America, welcome to reality :)
The great irony of all of this was that it was an American, W.E. Deming, whose methods the Japanese adopted to achieve the quality for which they are now synonymous. It was not always so: when I was a kid (60’s), Made in Japan, meant cheap and shoddy.
Read his story; he’s revered as a god in Japan….and was ignored here in America after helping us win WWII.
Ah, evidence of a dastardly plot to destroy the Chinese. Just let GM management infiltrate their infrastructure and their vaunted efficiency will vanish. GM will even manage to lower their already well-known reputation for bad quality.
Guandong Motors is becoming closer to reality.
powerpeecee :
September 24th, 2009 at 2:03 pm
To qualify my statement – Visit a Wal-mart. Everything in there, all the cheap dreck that lines the shelves at wallyworld, came over on a boat from china. Look at what crap it all is. GM is the Walmart of cars to begin with so this move should come as no surprise.
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Your logic is very flawed.
GM builds crap. Yes, we can agree on that. Because for the same $, you can find better Jap/Korean alternatives.
However, it’s incorrect to say the Walmart stuff is crap. Because:
1) There is no higher quality alternative at the same price level
2) These products sell at a (slight) profit and doesn’t require bailout
3) These products essentially killed off competitors. Pretty much like what Prius did to other hybrids.
So, I would argue that the Chinese made stuff in Walmart are the best quality you can find at that price.
If money doesn’t matter, everyone could buy a CTS-V and claim the Honda Fit is a POS. But it does. And buying a $10 Chinese pot and complaining about it not being durable is like complaining a Honda Fit couldn’t do a 0-60 in 4 seconds. At the end of the day, the cheap $10 Chinese pot and the cheap Honda Fit meet no real threat from the US and prevailed.
Why China? No community organizers there.
Oh wait!
There is no higher quality alternative at the same price level
That’s because everything Walmart sells is such ultra-cheap garbage that it simply isn’t possible. It isn’t even a question of engineering or materials quality anymore.
It would take magic to match wallyworld price on quality goods. It just costs more than what they charge to make decent stuff.
IMHO you should buy once, instead of many times. Go for the quality product the first time instead of buying junque over and over.
Buy something Japanese and run it for two decades, or buy at least 5 American made cars in that time. Your choice.
I read somewhere that American companies penny pinch to make cheaper parts and just keep the profit (partly for the fatcats, and partly to feed the UAW Monster)
Japanese companies try to make the part higher quality without making it more expensive. It’s a cultural thing. Americans seem to not give a crap about making anything worth having anymore. It’s all about the profit. Gotta make that money.
Public companies are driven largely by short-term profits. Everything else be damned. When investors are breathing down your neck for a return, you aren’t going to think that hard about the larger societal implications of your cost-cutting.
Juniper :
September 24th, 2009 at 12:56 pm
I believe the first Toyota in the 30s was a copy of a Chrysler Airstream with a copy of a chevy 6 cyl drivetrain. At least according to the Toyota Museum. You don’t think Hyundai copied Toyota?
I stand corrected! Hyundai actually licensed Mitsubishi and Mazda technology for their cars.
powerpeecee :
September 24th, 2009 at 4:05 pm
That’s because everything Walmart sells is such ultra-cheap garbage that it simply isn’t possible. It isn’t even a question of engineering or materials quality anymore.
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Sounds like GM’s excuse for not producing competitive small cars.
Quality is relative. It’s entirely possible to deliver a $5 value for a $5 price tag.
It’s just irrational people ignored the fact they did get all 100% value of the $5 product. And keeps on complaining not getting a $100 value for the $5 they paid.
powerpeecee :
September 24th, 2009 at 4:05 pm
Buy something Japanese and run it for two decades, or buy at least 5 American made cars in that time. Your choice.
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Your example doesn’t apply here.
Yeah, you pay 20% extra for a Civic over a Caliber and (arguably) get double the product life. That makes sense.
But with $10 Chinese whatever, do you have a $12 alternative that’s proven to be much much better? Not really. More likely there is a $100 German branded alternative produced in Malaysia that looks and feels solid, but nonetheless doesn’t last any longer.
It’s like when you have to choose between a $15k Caliber and a $150k S600, which would you choose? Which is of better quality? Of course I would choose the Caliber, because I (and most) cannot afford an S600. And of course, the Caliber is the best quality that I can buy.
Given their relative market dominance, I would say that the Chinese products have better qualities than Japanese cars.
Areitu :
September 24th, 2009 at 5:26 pm
I stand corrected! Hyundai actually licensed Mitsubishi and Mazda technology for their cars.
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Geely started by licensing Toyota engines. But they started having their own engines around 2000ish.
Quote: Stingray :
September 24th, 2009 at 12:41 pm
I’m not judging on quality. Let’s see the engineer’s wage:
US/EU >>>>>>>>>>>>>>> China
R&D consultancies currently use a billable rate of $75/hour for a U.S. based engineer and $35/hour for a Chinese based engineer…Just two years ago, the billable rate for the Chinese engineer was $21/hour while the U.S. based engineer’s rate has held steady for years and the disparity between the two rates keeps closing. In India for example, many an offshore R&D facility has found out about the ‘20%-Jump’ reality in which every time a new R&D facility opens up in town, the HR department of the new shop recruits your talented staff by offering them a 20% raise. Eventually, there may be no offshore savings.
Until the financial meltdown of ’08, it was fashionable for car companies to have styling studios in southern California. The usual excuse given was to keep a finger on the pulse of the largest car market (California) in the largest car market (the USA). I don’t have a problem with GM having a local R&D facility in the fastest growing automotive market on the planet.
Technically, reverse engineering is a type of research.