• Jun 8, 2006

For the past decade or so, China has been looked upon by the automotive industry as something approaching a gold rush in waiting, with millions of units ripe for the selling. That may yet be true, but it's hard to reconcile that with the notion that China overbuilt to the tune of two million excess vehicles last year, and plans are in the works for about eight million more units. This, according to the country's National Development and Reform Commission.

Chinese vehicle sales are projected to hit 9 million units by the time 2010 slips from the calendar, so perhaps there won't be a glut of vehicles to drive prices and profits down. In the meantime, Chinese automakers are increasingly turning to exports to keep shifting units, which makes sense given that its vehicles are roughly 50 percent less expensive than European offerings, and 30 percent less expensive than Japan and South Korea.

What do you think, will China pan out? Or are automakers (both foreign and domestic) putting too much stock in its potential? Speak your mind in 'Comments.'

[Sources: Shanghai Daily; Taipei Times]



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  • 14 Comments
      • 8 Years Ago
      Don't forget GM is number one in China, so its much better to cooperate with China than to boycott their products.
      • 8 Years Ago
      Maybe if the unions didnt ask $20+ dollars an hour
      cars would be cheaper and people would buy more. And if people bought more there would be more people working. Go figure!
      • 8 Years Ago
      antonio, you need to take a vacation and visit China sometime. you will be suprised. ignorance towards the chinese based on false assumptions and your made up statistics will not last you very long in the very near future.
      • 8 Years Ago
      "US move ur China plants to Mexico n u'll see cheaper products for people of America,"

      look at VW ... lol
      yeah moving their plants to mexico helped them a lot ...
      • 8 Years Ago
      I don't see why not.

      There will be many bankruptcy, buyout and mergers.

      Much like the early days of Hyundai, Kia and many other Korean car companies, by the end of the day what's left is Hyundai.
      • 8 Years Ago
      It's typical Chinese manufacturing mentality - no surprise here. They ALWAYS over-produce. They assume that their growth rates will continue ad infinitum, and they have more factories making the same stuff than ever before, and all are making at full capacities at all times - supply/demand ratios be damned.

      Self-destruction is what I see for China's future - what they are doing now is unsustainable, and for cheap products like t-shirts, the oversupply (which is currently probably in the millions of container loads) is not so bad, but with cars, where the cost to manufacture has to be absorbed somewhere, it will cause some serious trouble when the government there stops printing money.
      Mick
      • 8 Years Ago
      I am 78 years old and remember making the statement:
      Japan will never be able to sell any cars in the USA, Remember Pearl Harbor! How soon we forget!
      • 8 Years Ago
      Guys guys ur missing how Chinese operates .. they overproduce and guess where these cars gonna go? how about exports? with labor really cheap im sure chinese cars are even cheaper than korean cars ... there goes the trade deficit with China ever growing in billions and billions more .. Mexico is a really a country US should consider helping out to recover instead of China .. im sure Mexico can do as good or even better products than China .. and guess what US government wont be worrying too much of people from Mexico crossing the border .... US move ur China plants to Mexico n u'll see cheaper products for people of America, you help build Mexicos economy, ur problem with people crossing the border will decrease and trade deficit with China decreased .. by the way im not Mexican
      • 8 Years Ago
      UnionMan,

      Maybe we WANT to flush you down the toilet...have you ever thought of that?

      I have...and trust me, I DO.
      • 8 Years Ago
      TV -> laptop -> Car

      First TV set, then laptop PC, world enjoy the products of Chinese manufactures. There will be no surprise in the near future, Chinese made cars appear everywhere.

      As a Chinese, I am very proud of the recovering Chinese power.


      • 8 Years Ago
      Good product and cheap/crap product from China

      There are good products made in China, like the iPod, Nike shoes.
      There are also crap product made in China, like .99 store goods.

      If you are looking for a dirty cheap car, you will get a crap made from China. Most likely, the Chinese car will be like all the Walmart goods, not so best but enough in quality.
      • 8 Years Ago
      We would, UnionMan, if your buddies with the white collars would design better cars. Blame them for making undesirable vehicles.

      Given the same price, the consumer will not settle for a subpar product.
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