Make Room For China

When we were in China in February 2002 to adopt our youngest daughter, Bailee, I did not see many private cars being driven. We visited three good-sized cities (Shanghai, Changsha, and Guangzhou), but most of the cars I saw were little red Chinese-built Volkswagen Santanas used as taxis.

Every once in a while I would spy a Buick or Audi (also made in China) driven by one of the few elite, but nearly everyone else rode clunky 80-pound bikes.

Much has changed in China in four years. According to Thomas Friedman, author of The World Is Flat, Beijing alone is witnessing 1000 new cars on its streets each and every day.

In other words, China is fast-forwarding from pedal power to automotive muscle, skipping scooters and motorcycles entirely, and doing it in the blink of an eye.

So it should come as no surprise that Chinese automobile manufacturers are springing up. While the Buick and Volkswagen factories in Shanghai may havehelped pave the first few meters of highway, the Chinese are taking over and working 'round the clock to catch up with the west.

And I mean that literally.

At the North American International Auto Show in Detroit, the Chinese made their presence known. In all likelihood, it sent shivers up and down the spines of USA's Big Three automakers headquartered right down the block.The Geely (pronounced Jee-ly) entered the show with little fanfare, and had only a simple booth with a rather basic four-door sedan. The car itself is nothing to write home about, as we've already had a pretty hefty does of boring econoboxes ever since the late-1970s.

No, the news was that this car, to be introduced in the US in 2008, will come in at under $10,000. Can you say unemployment?

Geely has been making cars in China since 1997, but its presence was a non-event. Until now. Suddenly it is grabbing headlines across the nation as the industry braces itself for the next Asian invasion.

The Japanese did it in the 60s and 70s. The Koreans did it in the 80s and 90s. And now the Chinese are going to do it in the 00s. Holy egg foo yung, Batman. Henry Ford must be turning in his grave. Maybe they should put seat belts in those things.

And that's not all. Malcolm Bricklin, the importer who brought us the Yugo in the 80s (we'll try to forgive this one) plans to import the Chinese-made Chery in 2007. The Chery will cost around $20,000 and compete with the likes of BMW and Mercedes Benz.

At a time when imports now comprise about 35% of all US auto sales, and Toyota is poised to topple General Motors within a year as the world's largest car manufacturer, news of these coming imports is rightfully sending shockwaves throughout the industry. And not only must the Big Three be worried, but also the Japanese and Korens who have built market share and factories in the US. If what the Chinese have done with every other product category they have entered is evidence, the Geely and Chery will forever change the face of how America drives.

Critics scoff that the Chinese will have quality control problems, the result of a low price and lack of experience building cars. But these critics do not understand how the Chinese have been overcoming these issues in every other product category they have touched. Their economy is developing at mach speed, and they do not need 100 years to mature like the Americans.

There is no denying that China's presence in our economy is far bigger than anyone would ever have dreamt even ten years ago. It will soon be our largest trading partner. The output of this emerging powerhouse is seen in every American household, and is not limited to just cheap toys and trinkets (e.g., Best Buy now sells Konka's 15-inch LCD television for a mere $212).

Wake up, everyone. China is moving in, and this time it's on four wheels. I say bring it on. Competition is good, and maybe the US auto industry will be forced to reinvent itself.

Dr "Where Can I Buy One?" Gerlich