The Deathknell of US Auto Industry: Here Comes China's Chery Motors

[JCMach1]

Four of Five cars have estimated MSRP of $19,000

While the past few months have been bubbling with activity from the Chinese front, the latest news being that the region has become the worlds number two vehicle producer, from 1.8 million units in 1999 to 3.2 million units in 2002 and 4 million in 2003 to 5.8 million last year, any news about Visionary Vehicles and its car-building partner Chery, the first automaker from China to announce its intentions towards the North American market, have been rather quiet; but for good reason. While Geely, a home-market competitor that has been basking in the glory as the first Chinese automaker to make itself present on North American soil at this years NAIAS in Detroit, Chery has been working hard to create a product that actually stands a chance to sell come the brands arrival in 2007...

In order to get a strong foothold in the United States, and to achieve its lofty first year goal of 250,000 units, a quarter million vehicles, and a full one million units a mere five years later, Cherys tactics are to build visually appealing vehicles that undercut the competition, not by thousands, but by $15,000 and more. According to initial information, almost every vehicle in the entire five-model lineup can be bought for $19,000, which is a bargain when compared to the rivals Chery is gunning for. Eventually, Chery will increase its range to a total of twenty different vehicles... http://car-reviews.automobile.com/news/chinas-chery-announces-five-car-model-range/1679/

BY 2010, THEY ARE EXPECTING TO SELL 1 MILLION UNITS IN THE US!
THE INVASION STARTS THIS YEAR...

Now comes the next stage of China's flexing of economic muscle. The first Chinese cars are heading for the United States in two years with an ambitious promise to sell as many as 250,000 vehicles in the first year.

It's no coincidence the China deal was unveiled just before this weekend's start of the big annual Detroit auto show. Nor is it a surprise the Society of Automotive Analysts plans to meet during this premier show with such a timely theme: "Survival in the Auto Industry: What Will it Take?"

China's Chery Automobile Co. Ltd. plans to offer the U.S. market an entry-level compact, a mid-size sedan, a luxury coupe, an SUV and a crossover - all with 100,000-mile, 10-year warranties. And China plans to price its vehicles 30 percent less than comparable cars.

Selling a China-made, China-brand vehicle here? That's a big step up from China's traditional role as a cheap wholesale producer whose goods are sold worldwide under established brand names of other countries.

Here's how the Chery arrival will work:

Malcolm Bricklin, the head of a New York company called Visionary Vehicles LLC and an entrepreneur known as the first importer of Subarus in the 1960s and the low-cost (and ill-fated) Yugo in the 1980s, has cut a deal to be Chery's North American importer. Backed by the investment banking firm Allen & Co., Bricklin is looking to sign up 250 dealers this year to invest in showrooms in time to launch U.S. sales by 2007.

Are the five Chery models Bricklin plans to sell in production? No, though that might be a benefit in designing vehicles expressly for the U.S. market.

Can Chery sell 250,000 vehicles (equal to the number of GM Saturns sold) in its first year here? Unlikely... http://www.sptimes.com/2005/01/07/Columns/China_s_new_export__c.shtml

[salin]

1. Interesting...

can't help it, but the Yugo comes to mind.

More seriously, this govt has paid no attention to the growing economic power that China is becoming - and instead are tying our financial stability to theirs per the policy of running huge deficits and counting on big buyers of Treasuries (selling of the debt) to Asian banks - with a growing chunk going to Chinese entities.

Wonder why the freeps are so silent?

[JCMach1]

2. These are serious cars, they are already here in UAE

Quality is good (as good as many american models). AND CHEAP... VERY CHEAP

[salin]

4. I don't doubt it

as I said, I couldn't help the Yugo thought, it just jumped into my head.

[TreasonousBastard]

7. Maybe because Malcolm Bricklin is...

the brains behind this particular invasion.

[Disturbed]

3. "Wonder why the freeps are so silent?"

Maybe they are waiting to buy those cars?

[salin]

6. my comment was not about the cars

but my commentary on how much this admin has tied our countries financial stability to Chinese banking interests.

[OmmmSweetOmmm]

8. But then think Hyundai. Who would have thought that a cheap South

Korean car would have such excellent ratings?

[WePurrsevere]

11. After a whole lot of research we bought a (used rental) 2004 Hyundai

We "emotionally" would have preferred to buy a Ford but logically there was no simply comparison. The Hyundai had the most bang for the buck. It's extremely well made, has a fantastic warranty of 10 years/100k, has more safety features included as well as more options included, has more cargo and passenger space, has enough umph to haul a trailer, gets decent gas milaege compared to others it's size, it has a very comfortable ride and it was priced a bit lower then a comparable Ford/Jeep (and we've since found out it holds it's value better too). The most important selling feature for us though was the warranty. Since the only reason we could afford to get a newer car was because my husband had to accept a comp settlement we can't afford to trade-in or buy a new car every few years we needed a car that would only need the basic maintence covered by us.

[OmmmSweetOmmm]

12. A couple of years ago when it was time to replace my sputtering Saab

I was looking at Hyundais. At that time used ones were a bargain but I was seduced by Acura Integras, and wound up purchasing a 1996 one. A new used engine later, it's still lots of fun to drive and the gas mileage is excellent. I gave up on American cars a while ago. My Taurus wagons had head gasket problems, my Chrysler minivans had transmission problems, and before those, my Pontiac Trans Am - rattled and had the acceleration problem that the Audi 5000 was doomed with.

[booksenkatz]

5. The Walmartization of the auto industry

China will have no problem selling to Americans, who have proven to be ever eager to purchase a) foreign vehicles and b) cheap products from China, regardless of the cost to American jobs. It reminds me of the "Le" craze 20 years ago. You could put "le" in front of any product and Americans would buy it. Foreign is always better just because it's foreign, dontcha know.

Today my family's jobs, tomorrow it will be yours.

[xchrom]

9. bingo!

our corporate masters want to see an{in terms of jobs} economically specialized country.

it escapes me the wisdom of slicing out huge sectors of your economy and giving them away to other countries.

[Crayson]

10. Welcome to GLOBALISATION

That's is the Globalisation we are being preached every day.
Stay competitive, Open new markets, produce cheap...etc...

The corporations wanted customs and whatever market restrictions fall away for their benefit.
The chinese are the one profiting from a globalised world NOW.

[nickinSTL]

13. "Americans...have proven ...eager to purchase...foreign vehicles"

When an American automaker produces a vehicle comparable to a Toyota, I'll buy American. Until then, I won't compromise reliability just to "buy American". I'm not willing to have to pay lots of American mechanics more than I should just so I can prop up the failing US auto industry.

edited to add: :hide:

[oneold1-4u]

14. American ingenuity and integrity

will take the little gas/electric scooters and combine them for enough power to move 1 or 2 people and their weekly Wall Mart purchases!
This common commute today keeps 60% of the gas stations in business!