If I were Toyota, I'd be shaking in my boots right about now. Sure, Scion seemed like a good idea few years back when ToMoCo realized its buyers' median age was seeping into Buick territory. Being charitable, one could call Toyota's youth brand an interesting experiment. Being honest, Scion is schizophrenic. And the kids ain't buying. And now they have some soon-to-be serious competition. Autoweek is reporting that Honda is launching a new "sub-brand" called Li Nian, which apparently means "subject" in Chinese. You're looking at an unnamed concept built off the global City/Fit platform in conjunction with Honda's Chinese partner Guangzhou Honda. The new brand will launch first in emerging markets (China, India) before eventually showing-up here in the States. Getting back to Toyota being frightened — kids might actually enjoy driving a sporty, inexpensive Fit-derivative– as opposed to a de-contented, lousy to drive Corolla hand-me-down. Li Nians should start rolling into dealerships near the guy that took your job in 2010. [There's that date again…]

Inside baseball-types will recall that erstwhile automotive magnate Malcolm Bricklin's dreams of importing a Chinese-built Chery car into the American market hit the rocks back in December '05. Into the breach (dear Horatio) rushed Chrysler. Last year, the American and Chinese automakers signed an agreement to produce an economy car for U.S. Dodge dealers and world markets. And now… nada. According to the AP , ChryCo's Chief of Asian Ops admits that a Chinese-made U.S. import is "not ready for the U.S. market." How not ready? "We have no progress to report," Phil Murtaugh told reporters at the Beijing auto show. "But we really are satisfied with those discussions." Discussions that lead nowhere being a good thing? Sure! "I don't think we're too far away," Murtagh assured skeptics concerned with the theoretical car's price, safety, performance, quality, reliability, ability to meet U.S. federal regulations and profitability. "But neither one of us are ready to say 'Let's go' yet..'" 

An internet website called Autoblog is reporting (through the hilarious power of Google translate) that Chinese battery firm BYD will unveil a plug-in EV minivan next week. The e6 strikes the Autoblog crew as reminiscent of a J-Market Honda Odyssey. On the whole, you have to admit the comparison reflects pretty well on a company that was building cell phone batteries not so long ago. But enough of my gushing, on to the stats: 186 mile range on full charge (220V), 0-62 in 10 seconds, and a top speed of 99 mph. Details on the recharging process are "dodgy," as Autoblog calls the translated hilarity. "The battery slowly filling civilian 220 V power supply; fast charge for the three C rechargeable battery, about 15 minutes can be a battery 80%," is the official word. But don't worry, the safety is fine. "The car carrying iron batteries at high temperatures, high pressure, impact tests testing, safety performance is very good, will not be explosions." Autoblog gives BYD the benefit of the considerable doubt, by assuming these "iron batteries" which "will not be explosions" are, in fact, lithium ion batteries. Why don't we all just wait until it gets an official launch in Beijing next week? After all, "e6 will be one or two years before the formal launch…" 

Chrysler LLC announced today that it has opened a design office in China, a move the Detroit Free Press calls "part of a much larger expansion by the Auburn Hills automaker to beef up its product design efforts outside the United States." While Chrysler slashes as many as 25k North American jobs this year, it plans on recruiting 1k engineers outside from outside the United States. Chrysler's Chinese operations are expanding to include more local suppliers, in India the local engineering staff is set to double. Arguing that Chrysler is designing models specific to rapidly growing markets abroad, VP for product development Frank Klegon points to the success of its Mexico division (which is set to add 450 new staff). "They're already doing unique product for Mexico that's designed and developed in Santa Fe and for sale in Mexico by themselves," says Klegon. "It's a resource center that we're building upon. They started out as more of a vehicle development and test facility and moved them into design." But something doesn't add up here. If this is all about "unique products for unique markets," then why is Chrysler selling a rebadged (Chinese) Chery A1 in Mexico as a Dodge?

Usually new Chinese cars are either knock-offs or just look horrendous (see Chery's V2). But designs in the PRC have been getting better (how could they not?) And now Roewe– the company that bought the rights to make the Rover 75 sedan after the British company imploded a few years ago– has reskinned and updated the 75. And it looks outstanding. In fact, this might be the best-looking Chinese car to date. The Roewe 550 is a midsize sedan, on the scale of a Honda Accord. Much of the design and engineering work was done by pros from the European engineering firm Ricardo, a subcontracter to Roewe's owner SAIC. The interior cribs some design elements from BMW and Renault. But overall this is a very impressive vehicle for a country known for platypusian vehicles and inelegant knock-offs.

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According to China Daily, sales of passenger cars in China rose 23.6 percent in March, compared with the same period last year. That's the largest monthly rise in seven months, attributed (in part) to the arrival of milder springtime weather. The market recovered after "freak winter weather" slowed sales, according to the China Association of Automobile Manufacturers. First-quarter sales rose 20.4 percent to 1.85m vehicles, including 1.37m sedans, 55.3k minivans and 101.8k SUVs. Taking both first and second place in sales for the first three months of the year: Volkswagen AG's two Chinese joint ventures, FAW Volkswagen and Shanghai Volkswagen. Coming in third in the sales race: Shanghai GM, the Detroit-based car maker's JV with Shanghai Automotive Industry Corp. China is the world's second largest car market, with sales of 6.3m vehicles last year.

The Hindu Times reports that the Society of Indian Automobile Manufacturers and TATA Motors have asked the Indian government to slap a 35 percent duty on Chinese goods. The duty's proponents argue that Beijing's enforced yuan-to-dollar parity has given Chinese manufacturers up to 30 percent advantage on exports. The proposed duty will supposedly level the playing field. Of course, what's bad for Indian manufacturers is good for Indian consumers. But protective tariffs have become a worryingly commonplace phenomenon in the Asian auto biz. Once one country gives its industry a small advantage, it tends to create a protective tariff arms race and from China and Korea to Malaysia and Indonesia, everyone is jumping in on the action. If India further legitimizes the practice, there will be few remaining incentives for fair competition in the fastest growing auto markets in the world.

Hyundai just started production at its new $790m plant outside Beijing, as it ramps up its bid to become China's largest car manufacturer. Forbes MarketScan reports that initial production at the new plant will be 200k Elantras, ramping up to 300k by 2010. This would give Hyundai's Chinese operations an annual production capacity of 600k, putting it at the top of the Chinese biz in terms of volume. But Hyundai has to match increased capacity with improved sales numbers. The Korean firm's sales were down 20 percent last year, and Chairman Chung Mong-koo has set the ambitious goal of increasing sales in the Middle Kingdom by 64 percent this year and by 100 percent by 2010. The new plant should help meet this goal, says Chung, as its economies of scale should help lower costs and increased capacity means more vehicles can be tailored to the Chinese market. With Chinese sales booming, the opportunity exists for Hyundai to score big sales. With commodity prices rising however, it remains to be seen whether the extra investment actually translates into improved profitability.

Say what you want about Chrysler's new marketing slogan, at least their name isn't Build Your Dreams. Automotive News (sub) reports that the Chinese manufacturer showed their potentially game-changing plug-in, parallel/serial "dual-mode" drivetrain at Geneva, where the reaction was so strong that several European distributors are now negotiating for rights to the brand. Besides operating in parallel and serial hybrid modes as the circumstances require, the drivetrain's recorded 110km range on a plug-in charge is nearly five times the rumored range of the yet-to-be-released Prius plug-in. Plus, BYD has a 248-mile range, all-electric version of its F6DM sedan currently plying the streets of Beijing in taxi form. Of course, as with the development of any new, high-tech drivetrain, the cost is excessive– try a nearly $8k premium over sticker price. BYD says that European distribution depends on finding creative ways to cut costs, and since parent BYD Group has battery manufacturing plants in Romania and Hungary, Euro-market BYDs could be made somewhere in Eastern Europe. European distribution is targeted for 2010, unless of course it is all just a dream.

It's a testament to the roaring Chinese economy that A-listed automakers in the Middle Kingdom increased output and sales by about 22 percent but still didn't meet analysts expectations (damn those demanding analysts!). But Manufacturing Business Technology reports that profits didn't rise in concert with sales and production. This sets up the industry for a tough time as commodity prices are expected to rise substantially over the next several years. Runaway steel prices will cost Chinese firms an extra $1.5b this year, and low profit rates mean these costs will likely be handed down to consumers. Against a backdrop of rising inflation for everything from food to fuel, this development will probably hurt sales in China's value-oriented market. All this bad news likely spells industry reshuffling in the offing, as low utilization of production capacity in the automotive sector should fuel a flurry of mergers and acquisitions to allow companies to stay competitive during the projected two-to-three year lull.

You know how awesome the GMDAT Suzuki Forenza sedan is? Unfortunately, we've never reviewed it here at TTAC, which is mostly due to our intimidation by the 127 horsepower engine. Still, the car has a real global role. In Canada (where it was recently discontinued) it was known as the Chevy Optra. In the UK, the Chevy Lacetti. And in China? It's a luxury car! The Buick brand, very strong in China, is offering this same car as the Buick Excelle, and they've just released pictures of a refresh. What a travesty that they would dilute the absolutely crucial Buick brand name in its only viable market – China – with a car like this. I spoke with Ash Sutcliffe of the China Car Times website, who responded to my brand dilution concerns as such: "…it could be that the Excelle is very cheap, and they feel that they are getting an American car for a Chinese price." In fact Sutcliffe says the price is in the heart of "first new car" territory. It's too bad that what's exciting for the first new car buyer is bad for the guy considering a Chinese Buick Park Avenue that costs 5 times as much as the Excelle.

In one of life's little ironies, Volkswagen is this year's "Official Vehicle" of Adolf Hitler's forgotten brainchild, the Olympic Torch Relay. With riots on the streets in Lhasa and reports of terrorism threats in China already marring the feel-good "One World, One Dream" vibes, the torch run was supposed to be a major  PR effort for the Chinese government and major sponsors. But things are not quite going to plan. The Guardian reports that pro-Tibet protesters broke a "tight security cordon" at Thursday's torch lighting ceremony, and are now planning multiple protests along the relay route. The convoy has already been held up several times due to protesters lying in front of the Vee-Dubs, and the Greek government is upping security in response to specific threats over the weekend. And the caravan of love hasn't even come close to the Nepal area yet where soldiers are already deploying to deal with protests. Maybe someone just needs to let everyone know that it's all good, man… these are green Volkswagens.

Rumors are flying that Chrysler is in talks with a second Chinese manufacturer. They already have an agreement with Chery to rebadge subcompacts for Mexico and South American markets markets and develop a subcompact for the U.S. (all under the Dodge brand). Now Reuters says they're looking into an alliance with Great Wall. Great Wall builds small SUVs, a small CUV and pickup trucks with some of the coolest model names going: the Wingle (say "Great Wall Wingle" fast three times) and the Socool. Obviously, Chrysler doesn't need more SUVs or CUVs. However, Chrysler hasn't had a small pickup since the rebadged Mitsubishi pickup they sold in the previous century. With sales of the Dakota "midsized" pickup in the cesspool, and big truck sales circling the toilet, they could be looking at Great Wall to provide a small truck– a vehicle Chery can't supply. So if the rumors turn out to be true (and inside sources say they are), the next small Dodge truck could come from the People's Republic of China. And pave the way for… the end of domestic car production.

With the Olympics set to thrust The People's Republic of China into the world spotlight, the dictatorship's rulers have been attacking "environmental issues." Green Biz News reports the latest step in what the Chinese Communist Party terms "the scientific model of development:" a massive auto-parts recycling program. Three manufacturers and 11 parts suppliers have "agreed" to recycle engines, transmissions and electrical generators. The China Association of Automobile Manufacturers estimates that four million old cars will be junked each year by 2010. They maintain that refurbished parts from dead cars cost only 60 percent of new components. Meanwhile, in the U.S., parts recycling companies like LKQ are making big money (even without government intervention). As automotive profits become harder to find in a sagging economy, reuse and recycling is getting a major shot in the proverbial arm. See how that works?

Bloomberg reports that Hyundai's been hit hard by rising steel prices. Apparently, China's Olympic building boom is causing localized shortages and driving up prices. Rising raw materials costs cut especially deep for the value-minded Hyundai brand, who can ill-afford the hike. "The higher prices come at a difficult time,'' says Mirae Asset Securities analyst Kim Jae Woo. "Hyundai won't be able to pass on the higher costs to customers as the slowing global economy is already damping auto demand.'' Steel prices are expected to continue rising for the considerable future; raising an interesting challenge to the strategy of manufacturing in east Asia. Although low labor costs have made the region popular among budget automakers (e.g. GM's Daewoo), China's economic boom is putting increased pressure on commodity prices. In the cutthroat global automotive industry, there's nowhere to hide.