Are you in automotive R&D? Experience and successful track record in automotive marketing? Worried about your job? Polish up your resume. Chinese automakers are hiring. “After considering the risk of buying US auto manufacturers’ assets, Chinese automakers realized that targeting their research and development (R&D) talent would be a more realistic and profitable option,” writes China Daily today.

China Daily called around. Zeng Qinghong, General Manager of Guangzhou Automobile Group, for instance said that his company is not interested at all in buying brands or whole companies in the U.S.A. However, he’s very interested in US auto professionals. The head of his research center had already been on a recruitment trip to the US, and he was surprised: “Interest shown by US auto talents in Guangzhou Auto exceeded expectations.” Xu Heyi, board chairman of Beijing Automotive Industry Corp said that they are also interested in talent from the US. Even the Chinese government is prodding their auto industrialists to buy themselves some foreign know-how.

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There has been a lot of speculation why the Chinese have such a hard time exporting meaningful numbers of cars. The Chinese government even has a 7 point program to boost exports – under review.  Allow me to add an eighth point to the program – after all, 8 is a lucky number in China: Find someone who writes serviceable tag-lines, in English. “Unlimited Almightyness” (a tagline for the Great Wall  Hover CUV)  just won’t do, unless you are advertising the pope mobile. For a free review of your taglines, give me a call. New lines at a slight extra charge.

Two weeks ago, Chrysler terminated its joint venture talks with Chery. This doesn’t stop Chrysler from talking to the Chinese. The talks go in two directions: One, Chrysler needs low cost cars, and the Chinese have them. Two, Chrysler is looking for a buyer, and a Chinese company may just have mercy and cash and take Chrysler off the sweaty hands of Cerberus. Hell, you never know. Now, Chrysler has been spotted chatting up Great Wall Motors, Gasgoo reports. Great Wall is known for its large portfolio of SUVs and MPVs. They also got into hot legal waters with Fiat who claimed that Great Wall’s Peri (called Jing Ling in China) is a copy of Fiat’s Panda. A court in Turin said Fiat is right and Great Wall is wrong. A copyright claim in China is slowly grinding through the wheels of the Chinese courts.

According to Gasgoo, Philip Murtaugh, Chrysler Asia CEO, went to inspect Great Wall Motor’s facility last week to look into the code-named CH041 model and CH031 hatchback, which could be the A-class model Chrysler needs. Murtaugh was supposedly satisfied with the two models. Great Wall Motor said the two parties will launch “CH031” first if the projects fare well. The two automakers are still in talks and nothing is definite yet, said Great Wall Motor. If the models see the light of mass production, they will go on sale in overseas markets with the Chrysler label. A Chrysler China executive said Chrysler was in – duh – “a transitional period.” They might need Great Wall, one way or the other.

China has a 60 percent local content law for cars. If local content falls below that mark, the car is treated as an import, even if it’s Made in China. That means a 25 percent duty. “Unfair!” said the US, EU and Canada, and filed a complaint with the WTO in March 2006. In July, the WTO ruled that China is wrong. China appealed. The WTO now rejected the appeal, and China has to come into compliance. “WTO’s final ruling marks the first time the country has lost a legal trade dispute since joining the global trade body in 2001,” China Daily regrets.  However, the Chinese parts industry’s fear of a flood of cheap imports from the EU and NA is unwarranted, China Daily says: “Analysts say that the effect on the domestic auto industry would be minimal since many multinationals would still prefer using local car parts to imported ones even if the Chinese government lowers the tariff over some auto parts.” According to a report by China Galaxy Securities, most multinational carmakers have already started making more car parts in China to cut costs. Honda and Volkswagen, for instance, make over 80 percent of their components in China. And China doesn’t have to change tomorrow: “China now has a reasonable period of time to bring its measures into compliance with WTO law,” the European Commission said in a statement. “This period of time will be negotiated or determined by arbitration.” Time is on China’s side.

For quite a while, Dongfeng, China’s third largest automaker, had been rumored to be interested in taking over GM. Now, Dongfeng has lost all interest in the deal, China’s Securities Daily reports via Gasgoo.

It’s very interesting what Xie Dashun, a publicity officer at Dongfeng has to say. Yes, there were talks. And no. Dongfeng doesn’t like what they saw, or what they were not told: “Even though Dongfeng has contacted GM, the results are not available yet. Personally I don’t think Dongfeng has the ability to save GM, a company that neither its CEO or the U.S. government is able to save.” Strong words from the usually very polite Chinese, and from a company that is mostly owned by the central government. Even Gasgoo can’t help themselves from mentioning that GM’s “problem is far beyond the money value.”

Gasgoo cites an industry analyst who said that “it’s still early to talk about the acquisition of GM by a Chinese auto company before the U.S. automaker files for bankruptcy. Almost no Chinese enterprise has the might to buy out the U.S. auto giant, and the cash flow of Dongfeng Motor is far from enough to buy an American company like GM.” Note the “before the U.S. automaker files for bankruptcy.”

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The Chinese government is considering plans to breathe new life in their still growing, but sputtering auto market. “Industrial growth is sharply declining and we have not seen a turning point yet. We feel a lot of pressure,” Industry Minister Li Yizhong said at a recent news conference in Beijing. The Minister laid out several initiatives, “but gave no indication any measures had been decided or when they might take effect,” Gasgoo says. The possible steps are:

– A $2.2 billion package of subsidized loans, targeted at improving technology and cutting energy use.

– Beijing might buy surplus steel to help producers and give aid to steelmakers for upgrading technology as demand plummets.

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The on-again, off-again affair between China and the Gubernator’s favorite toy is on-again. China’s Changfeng rekindled its interest in the HUMMER, Gasgoo reports. “We never quit talks on acquiring the brand,” said Zhengchu Chen, General Manager of Changfeng Motor in an interview with Beijing’s Jinghua newspaper. “But now instead of doing it alone, we decided to form a partnership with AM General to reduce the risk as the global economy falters.” Changfeng and AM General LLC have a plan: the two sides are exploring possibilities of building a joint venture company.

Changfeng showed interest in the brand earlier in the year. Representatives of Changfeng even went to the U.S. on an inspection tour. They came back unimpressed. Reuters reported that “the Chinese SUV maker backed off after touring Hummer’s U.S. factory, citing limited potential to market the vehicle.” Well… The Chinese SUV market is still vibrant. From January through October 2008, China’s top 10 SUV makers sold more than 300K units.  More likely: the price tag for HUMMER has dropped. And a joint venture with a maker of American military vehicles has certain, uh, inherent appeal. Already, there are several HMMWV clones in China, such as the EQ2050 by Dongfeng and the SFQ-2040 by SAC. So….

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Duh. After a month of increasing indications that mostly Chinese concerns may be interested in snapping up pieces of the D2.8, the MSM is cautiously warming up to the facts of life. It’s happening everywhere. Except at the stalwart Detroit News, which sticks to it’s “see no evil, hear no evil, write no evil” editorial policy, and where a search for “SAIC” produces “GM to offer OnStar service in China.” Good luck with that.

“Now, Americans will be introduced to car companies like Tata from India and SAIC Motor Corp. and Guangzhou Automobile Group Co. from China,” writes Robert Rector for the Pasadena Star-News. “Undoubtedly, they will likely follow the Japanese model and build factories in the United States because of the cost of transporting fleets of automobiles across the Pacific.” Points for not giving up the hope. But wrong, Mr. Rector. First, Tata is most likely out of the game for a while, for reasons we shall see further below. Second, the cost of transporting fleets of automobiles across the high seas is minor compared to the price of the car. Especially now where ships are sailing half empty. Factories are built when exchange and labor rates are unfavorable. The Chinese will most likely keep as much as possible in China. Even Motor Trend wakes up:

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It’s high time to start a new TTAC category: China Buyout Watch. It’s good for at least a post a day. The latest: “SAIC is likely to be the potential buyer of Saturn,” says Gasgoo after reading the print edition of China Automotive Review. They cite an email letter that has told Saturn dealers that interested buyers were ready to buy Saturn. A Detroit-area dealer for Dodge and Saturn said GM was seeking buyers in China. According to the report, GM tries to package Saturn and Hummer together. A price has not been named.

After last night’s Congress cruelty, there might be government help after all. From the Chinese government.  In China, the interest of Chinese automakers has grown far beyond the rumor stage. Today, government-controlled China Daily (THE English speaking news outlet for the official party-line) runs a long article on the Chinese aspirations to snap up juicy bits of Detroit. Actually, as China Daily sees it, it’s Detroit that’s making the advances to China. The headline says it all: “Big 3 look for Chinese medicine.”

After issuing the appropriate CYA cautionary notes, as in “Chinese companies should exercise caution when it comes to acquiring US assets,” China Daily lists a virtual speed-dating session between Chinese and Detroit automakers …

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Meanwhile in China, cars are waiting to be loaded at the port of Guangzhou. The LA Times had sent a photographer to China, hoping to find something worse than Long Beach. He aimed carefully, narrowed the field of view, and still came up with empty lots. The Chinese car trade isn’t hit hard by the export slump, because it’s so small, that it’s hard to hit. Other exports are way down, the LA Times reports while they are there. China’s exports to the U.S. dropped 6.1 percent in November as Americans avoided even Wal-Mart.

The story of Ford hawking Volvo to China is getting curiouser and curiouser. That story appeared first in China’s respected National Business Daily. Then, via TTAC, it hit the fan, the wires, and the MSM. The story made the rounds from Forbes to the Chicago Tribune, even the DetNews headlined: “Ford partner in China considering buying Volvo.” Ford’s partner in China is Changan. The codependent joint venture produces Volvo cars for the Chinese markets. Buying the Volvo brand outright would enable Changan to enter the lucrative export market with an established brand at a competitive price point. And now, the denials.

Today, Gasgoo reads the Wall Street Journal Asia. To everybody’s surprise, the WSJA found “a person familiar with the matter.” The familiar person says that Ford and Changan have not talked about a sale of Volvo. WSJA’s deep throat comes up with a rather flimsy story: According to Mr. Mole, Ford execs had met Changan execs simply to inform them “as a courtesy” that Ford was looking for a Volvo buyer. As in “We just happened to be in Chongqing, so we thought, we come by, say hello, and by the way, we are looking for a buyer for Volvo. Know anyone who might be interested?” A search of the WSJ database comes up empty. Strange. It’ll get stranger …

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It’s a strange world. In the past, when China’s economy was down, most of the world (at least silently) cheered. Now, as China’s growth slows, the world gets worried. Suddenly, it’s news when China’s auto sales fall 10 percent in November. Suddenly, the world gets alarmed when for next year, growth rates of only 5 percent are being projected. Yet, China may be out of the slump much faster than many think, or some still silently hope.

Business Week predicts that in the second quarter of 2009, “the benefits of China’s massive $582 billion stimulus package could start to flow through, and the economy could kick into a higher gear once again.” The signs are everywhere, says Business Week.
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Yesterday, we reported that Ford is in a big hurry to unload Volvo to interested parties (preferably) in China. The article quoted a story in London’s Times. The Times had received information that Ford is talking with SAIC to take Volvo off Ford’s hands.  There are more interested buyers:  Top executives of Ford’s Chinese joint venture partner Changan are in talks with Ford to buy Volvo. This according to China’s National Business Daily which has it from an insider at Changan.

At the Guangzhou auto show last month, Volvo’s top executives had long talks with Changan Auto president Xu Liuping. When Ford Motor announced its plan to sell Volvo, the presidents of Ford Asia Pacific, Ford China, and Volvo China met Changan’s president at Changan’s HQ in Chongqing for closed-door talks. NBD’s source added that it is logical for financially troubled Ford Motor to consider Changan as a possible Chinese partner of its Volvo brand, because they have the Changan Ford Mazda joint venture which is also producing the Volvo S40 and S80 models. There are more reasons to buy …

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The phone lines are running hot between Detroit and Shanghai. Ford is in talks with SAIC, China’s biggest car-maker, in what UK’s Times calls a “desperate attempt to sell its prestigious Volvo brand.” Ford has already tried before, and had been turned down by the Chinese. The Times quotes “a source close to the American motor giant” who says that earlier talks, which took place in summer, broke down over price. Ford had bought Volvo for $6.5b in 1999, and wanted to clear $5.9b. “Mei xi” (no dice) said the Chinese. The Detroit source that’s leaking to the Times (probably with a nod from higher up) says: “Now that Ford is in dire straits this would be a good opportunity for SAIC to snap up Volvo on the cheap. The price has dropped considerably since seeking a sale in the summer.”

According to Aaron Bragman, a car industry analyst with economic forecaster IHS Global Insight, “the sale of Volvo has become part of the conditions of Government assistance.” Ford is being advised by the investment bank JPMorgan Chase.

A spokesman for Ford confirmed that the company is in talks “with a Chinese car-maker,” but declined to name SAIC. SAIC likewise declined to comment. There are other suitors, just to keep SAIC from thinking they are the only game in town …

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When TTAC’s Bertel Schmitt first blogged the story that China had designs on Chrysler and GM, the resulting traffic melted our server. So we added another one. That one melted too. Our stalwart TTAC technical team tells me they’re now load balancing– and doing something about handling our traffic spikes. The view counter’s disappearance serves as a stark non-reminder of that terrible, wonderful day. And, of course, Bertel wasn’t just whistling Dixie (or whatever Germans living in China whistle). Bertel’s given us more inside dope today, as Bloomberg breaks the story into America’s MSM: “Dongfeng Motor Group Co., China’s third-largest automaker, said it had received proposals from investment banks to buy assets from General Motors Corp. as the U.S. carmaker tries to avoid running out of cash,” Bloomies reports with a hint, hint, nudge, nudge, knowwhatImean?  “’We’ve gotten e-mails and investment materials asking us whether we would be interested in buying some of GM’s assets,’ Hu Xindong, head of investor relations, said by phone today. ‘So far, our management has not yet reviewed the issues and we have not yet responded.'” GM says it isn’t in talks with Dongfeng, but that’s not what the story says, is it?