Chinese makers descend on Frankfurt
BY NEIL MCDONALD | 3rd Oct 2005
The three main Chinese car manufacturers – Geely, Brilliance China Automotive Holdings and the Jiangling Motors Group – all exhibited their international wares at the recent Frankfurt motor show, marking a coming of age for the infant Communist car industry.
However, Mr Wagoner told GoAuto that 99 per cent of China’s automotive output would be absorbed in China before any serious export markets were pursued.
"I think that’s going to be the case for a significant period of time," he said. "Having said it: Will there be some exports? Yes I expect there will be.
"Asia is a more natural market than Europe and the US for a variety of reasons. The Asian economies are growing, I think probably some of the product fit is going to be a little more natural there." Despite his casual acceptance of China as a global player, Mr Wagoner said it posed a huge threat to Western markets, including the United States.
"A while ago someone announced a plan to sell 250,000 units from Chery in the US by 2007," he said. "That’s highly ambitious. I don’t think that’s going to happen over that timeframe. But I think that we should expect that over time the Chinese industry will develop in a way that’s pretty competitive." Mr Wagoner also believes Australia is in the front line to receive Chinese-built cars.
Volkswagen has already tested the waters with the Chinese-built Polo sedan, which has had a lukewarm reception here. Build quality is among the key issues.
Mr Wagoner conceded there might be a day when GM vehicles are built in China and sold in Australia.
"I don’t rule it out – but it’s not something that we currently have on the mainline agenda," he said. "We are going to be bringing in some more products into Australia from Korea and I think it’s not a big step from there to think about China.
"But as we’re working on it today we don’t have anything that I can cite for you."
It took the Japanese more than 20 years to become serious competitors in Western markets, and the South Koreans "half that time", he said.
With the assistance of foreign partners, Chinese manufacturers could move even faster, once they venture outside their own borders.
"It’s just the trend to globalisation in every segment in every market," he said.
The Chinese manufacturers were tucked away from the mainstream offerings at Frankfurt, however, their mere presence sent a chill through European manufacturers, most of whom consider them a serious threat.
The Chinese trio exhibited about 10 vehicles, most of which still require homologation for European regulations. However, manufacturers and importers of these vehicles told GoAuto they were close to earning European Union approval.
Of the three, refrigerator maker Geely, which was founded in 1986 and built its first car in 1998, had the biggest presence with five cars.
Geely builds a range of 1.0-litre, 1.3-litre and 1.5-litre small sedans and hatches priced from as low as $US4000 ($A5220).
At Frankfurt, it unveiled its new $US12,000 ($A15,600) 1.5-litre CD (China Dragon) coupe, which boasts electric windows/mirrors, central locking, leather, park distance radar and a CD/DVD stereo. The four-cylinder engine develops 69kW at 6000rpm and 128Nm at 3400rpm.
Company spokesman Li Shufu told GoAuto he was buoyed by the positive response to the cars, saying the brand had not yet looked at Australia but was keen to look at all possible markets.
Geely is already exporting to Africa, the Middle East, Central and South America and has just established import relationships in the United States, Europe and South-East Asia.
Its European partner is Portuguese importer Hipolito Pires, which will receive the first cars this month and is assisting in getting EU-type approval for three sedans.
GoAuto found that the Geely cars on show at Frankfurt and Jiangling’s Isuzu Frontera-lookalike Landwind four-wheel drive – the only Chinese-built (Nanchang) vehicle currently sold in Europe – were all distinguished by low-rent interiors, coarse plastics, poor panel fit and below average paint finishes.
The Brilliance Zhonghua 2.0-litre mid-size sedan was the most polished vehicle on offer.
About the size of a Holden Vectra, the Zhonghua is highly equipped and expected to go on sale in Europe in November with a pricetag of about $US21,000 ($A27,500).
The Gibraltar-based Euro Motors is the private importer for the Brilliance Zhonghua, which is built by the Shenyang Brilliance Jinbei Automotive Co in Shenyang, which also has a joint venture deal with BMW.