As U.S. President Barack Obama landed in Shanghai for a weeklong visit to his largest creditor, China, the news awaited him that China’s Ministry of Commerce will investigate the U.S. government’s financing and rescue plans for the American auto industry, Shanghai Daily reports.

The move is part of China’s probe into possible dumping and subsidies on U.S.-made vehicles imported to China, the ministry said. Trade officials will be looking for dumping practices and for unfair government subsidies.
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In January 2009, China surpassed the USA as the world’s largest car market. Since then, the gap had widened month after month. While China is clocking in near triple digit growth rates, US sales are still down. Even GM’s Henderson believes that China will stay ahead of the USA for quite some times. “It’s not a blip,” Henderson said to AFP. Now, eleven months later, the news transpired to the Freep.
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In October 2008, new car sales in carpocalypse-affected Europe had dropped by 14.4 percent. A year later, the Old Country is slowly coming back to normal. In Europe as a whole, new car registrations grew by 11.2 percent over October in the previous year. This according to the latest statistic of the European Auto Manufacturers Association ACEA. Since losses turned into gains in July, this is the first time Europe comes in with double digit growth. However, not all is rosy.
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When we reported Chinese rumors that Veedub might open a factory in Southern China to make up for its lack of exposure and market share down south, we wondered “which of their two Chinese joint venture partners will get the new plant.” If the latest rumors are true, all options are wide open. It might even be a new joint venture partner. According to Guangzhou Daily (via Gasgoo) Volkswagen could bring its ill-fated SEAT brand to China.

We’ll know more when VW will announce its “South Strategy” at the 2009 Guangzhou auto show next week. If they do.
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This week’s chronicle of the Opel saga starts with good news and bad news.

The good news:  GM’s European headquarters will move from Zurich, Switzerland, to Opel’s home in Rüsselsheim near Frankfurt, Germany, reports Die Zeit. The paper: “With the move, the company probably wants to collect points to calm down the German government.” Let’s put it this way: Putting the European GM headquarters into a country that is not even part of the EU, that is more known for its tax haven status than for its flourishing auto industry, did not amuse the Germans. Returning to Deutschland, GM can pat itself on the back: The move created 150 jobs in Rüsselsheim, which are lost in Zurich.

The bad news: It’s too late to collect points.
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Worried about increasingly efficient cars and dwindling tax revenue at the pump, Dutch lawmakers approved the first “pay-as-you-drive” tax system in Europe. Of course, the dwindling revenue is not the official reason given. The official intent is “to protect the climate and to reduce traffic jams,” reports the Deutsche Welle. Now who can be against noble causes such as those?

Nobody even mentions gasoline taxes, the legalized form of highway robbery in Europe. The pay-as-you-drive system will replace the old system that taxes ownership. That will go. The fuel tax remains. Dutch citizens are taxed twice. At the pump and by the kilometer.

Beginning in 2012, Dutch motorists will pay approximately 3 Euro-Cent per driven kilometer, until 2018, the amount will rise to 6.7 Cent. The actual costs vary according to size and engine of the car. A Renault Twingo will cost you 1.4 Cent per km, an Audi A8 will get the Dutch government 16.6 Cent per klick.

And how will the government know?
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When Magna was buying Opel (along with German help and alleged Russian mobsters) Volkswagen made noises about dumping them as a supplier. Vergeben und vergessen.

“If Magna doesn’t act like a competitor, we will continue to do business as usual,” a Veedub spokesman told German tabloid BILD (via Reuters.)

Now is not the time for VW to switch suppliers anyway.
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An uncouth interview, given by GM Chairman Ed Whitacre to the German newspaper Muenchner Merkur at the sidelines of an event at the Texas Lutheran University, has shut the doors on any donations Berlin may make to Opel’s cause. Aus. Vorbei.
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While other brands are busy closing down dealers, Volkswagen is buying them. They buy the big ones, to be exact. The smaller ones have been eliminated ever since yours truly has been working for VW.
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The Opel/GM saga has more twists than New York’s Peppermint Lounge. Yesterday, we reported that GM’s Smith & Reilly went to Berlin to beg money from German Economy Minister Rainer Bruederle. They received the cold shoulder.

Like good salesmen, they didn’t take no for an answer.
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A very strange spy scandal is brewing between (South) Korea and China. Acting on a tip of the (South) Korean National Intelligence Service (the Korean equivalent of  the CIA and FBI rolled into one,)  Korean state prosecutors accused China’s SAIC of stealing sensitive state secrets from Korea.

Then, they indicted seven senior Korean engineers at Korea’s Ssangyong on charges of leaking technology essential to develop hybrid cars.
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GM’s John Smith, and a freshly minted GME CEO Nick Reilly went to Berlin to see German Economy Minister Rainer Bruederle, hat in hand, hoping for some Opel funds. They left empty handed.

“I expressed my expectation that General Motors should basically carry out the financing itself,” Bruederle said after the meeting.
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“China is a global driver of growth in the automotive market,” said Friedrich Eichiner, CFO of the BMW Group. “China will play a major role in the global automotive business, in the development of future technologies.” Then he signed off on a major expansion project. Together with joint venture partner Brilliance, BMW will be able to produce 175,000 Made in China BMWs, up from 30,000 units currently.
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China may be the world’s largest auto market until further notice. Its much feared auto exports however are nothing to write home about. In fact, China’s already measly car exports have declined for 14 consecutive months since August 2008. For the first half of this year, China exported only 191,000 units. This in a market that is expected to be good for 12m units domestically. Other countries, such as Germany and Japan, typically export the same number of cars they consume at home. A good deal of the few vehicles that are exported from China are commercial and utility vehicles, sold to underdeveloped markets.

Two months ago, Zhao Hang, President of the China Automotive Technology and Research Center, blamed quality and after-sale service problems for the underwhelming performance. He also said that Chinese auto exporters lack knowledge of overseas demand, government policies, regulations and certification.

The Chinese government can’t stand it any longer.
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Magna and Sberbank want their money back. Everything they had so far invested into Opel needs to come back from GM, says Das Autohaus in Germany.” We are in negotiations with GM and we hope that we don’t have to go to court “, said Sberbank boss German Gref. “If all else fails, we’ll defend our position in a court of law.“ Gref did not name any sums. Magna also wants their money back. Magna’s Siegfried Wolf said “it is a considerable sum.”

The German government also wants to have their loan back before it will entertain any further discussions. The loan is due by end of November.