U.S. insurer AIG buys stake in Chinese carmaker Lifan
One of the main concerns that Autoblog readers have about Chinese cars is their safety. We've seen some fairly horrific crash tests of Chinese-made cars recently, but some improvements, as well. You just gotta know American insurance companies are not looking forward to these things being on U.S. roads.That's why we find it quite ironic that U.S. insurance company AIG has bought a sizable stake in Chinese car and motorcycle-maker Lifan. We haven't seen any Lifan crash tests, so their cars could beat even Volvo at the safety game for all we know. But so far, Chinese cars in general aren't exactly known for their safety.
While one report says AIG's piece of Lifan could be as big as 25%, Lifan's Chairman Yin Mingshan said last year his company would not sell more than 20% to any one investment company. The deal awaits approval from the Chinese government, which is expected to come later this month or in early March.
AIG apparently sees lots of potential in China having also announced in July that it had received permission to begin selling insurance in China.
[Source: Reuters and Market Watch via China Car Times]
Reader Comments (Page 1 of 1)
Seoultrain 6:18PM (2/05/2008)
As crappy as their cars may be, any company with a decent marketshare in China's rapidly growing auto industry is a sound investment.
Business doesn't have to make cents. They make dollars.
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Houston 7:22PM (2/05/2008)
shame on u,seoultrain
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Harry 7:58PM (2/05/2008)
Haven't seen any crash tests? Ah, well you're in for a treat...
http://www.theautochannel.com/news/2007/11/06/069799.html
http://www.zr.ru/news/157309/
I apologize for the second link being in Russian, but the pictures and video are what's important there. As you can see, the 520 did very well in the 56 km/h test (especially compared to it's Chinese counterparts).
Lifan is an exception in China. I often trumpet their praises over at China Car Times, but it's for a reason. I see them as a Chinese version of a company like BMW or Honda. They started out as a dirt bike/motorcycle manufacturer in the early 90's and expanded at a furious pace. They are renown throughout China and SE Asia for their well-made bikes and sub-1L engines. More recently, they have made a foray into the car market, and have been setting up CKD assembly plants in Russia, Ethiopia, and Vietnam. Their cars appear to be well-engineered and because of Lifan's strict, Honda-like supply chain and quality control, they are able to offer unusually long service and warranty guarantees.
I swear I'm not getting paid by these guys (wink wink), but this is an awfully smart investment by AIG.
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gofaster 9:24PM (2/05/2008)
The logo looks like 3 vacuum cleaners
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Drewboy 9:51PM (2/05/2008)
AIG does a lot more than just insurance. AIG is the sixth largest company in the world. Remember a few years ago there was a big issue about a Dubai company buying up US ports? AIG bought them. AIG also owns the worlds largest aircraft leasing company, ILFC. AIG also owns most of the telecommunications network (land-line and cellular) in Bulgaria. I guess that's just scratching the surface, they own a lot more. I deal with them on the insurance side of things on a daily basis.
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Level 10:39PM (2/05/2008)
why is everyone so afraid of chinese cars having poor crash test ratings???every car in 3rd world countries have the same bad crash test ratings....and as far as the US goes....its gonna have to meet a requirement of tests b4 its sold on dealer lots....If a chinese car were to make it to a US dealer lot it has been deeemed safe for public roads, u guys act like their are no laws here lol.....every auto maker should be afraid once the chinese pass US safety regulations lol....
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Kirky 3:05AM (2/06/2008)
Here is another Geely crash test:
http://www.youtube.com/watch?v=8vAN2cx2UIE&eurl=http://thehollywoodextra.blogspot.com/
Perhaps this insurance company wants to find out what will happen to their customers after they crash in one of these.
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Harry 3:11AM (2/06/2008)
Again, not all Chinese cars are the same - it's unfair to group them together like that. Geely has no relationship with either Lifan or AIG.
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Dark light 5:50AM (2/06/2008)
hey don't be stuck up mr. hyundai
may i present to you the old past of hyundai
http://www.euroncap.com/tests/hyundai_accent_1998/36.aspx
Geely is just started out, so remember your korean cars.
Lifan is different from Geely.
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Darklight 6:47AM (2/06/2008)
and something here for you
BYD crash test
http://www.youtube.com/watch?v=yAskckqdCLk
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Andrew 3:19PM (2/06/2008)
I met the head of AIG's Private Equity group in China. He knows what he is doing. Watch this stake double in value in the next 6 months.
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jack 7:44PM (2/07/2008)
AIG is a world class insurance company. If they are investing in LiFan, they know what they are doing, and like another poster said Korean cars like Hyundai were considered crappy once too. What most Americans/Eoropeans do not realize is Chinese comanies/industries are advancing at a very rapid pace. I the near future I believe their cars will be of equal safety/reliability of Japanese/European brands. When that time comes most of you will be bitching about Chinese companies taking market share away from Toyota/General Motors/Hyundai. This scenario is a
decade away.
I regards to this statement:
"You just gotta know American insurance companies are not looking forward to these things being on U.S. roads."
In my opinion as a New York City resident/driver, the most dangerous things on the road are the immature, arrogant, road rage, American drivers from Generation X and Y and the younger baby boomer generation.
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Dark Light 6:36AM (2/11/2008)
This is a perfect Korean car for you
http://youtube.com/watch?v=VQE2O7FSjF0
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