Posted by: David Kiley on May 26, 2005
Our News Analysis & Commenetary this week, Here Come Chinese Cars, was an interesting piece to work on. The efforts thus far to bring vehicles from China to the U.S., and sell them under their Chinese brands, is just getting underway. But my take from watching this development is that Chinese vehicles are coming and they will have as much staying power as the Koreans—Hyundai and Kia.
I agree with AutoPacific’s Jiim Hall and J.D. Power’s Tom Libby who both say that U.S. carbuyers will be lured to the Chinese cars based on price, with a few buying out of curiosity. But these new companies will have to establish trust, quality, reliability and service fast, or they will go the way of Daewoo, the Korean company that thought it could take on the U.S. on the cheap. Like Hall says, “Nobody wants to be driving a car, have it break down and not be able to get it fixed for days.” That’s what happened with Hyundai in the early days, as well as Yugo.
Our feature on Malcolm Bricklin and his Visionary Vehicles is the best known effort, but he probably won’t be first. David Shelburg, 75, of Scottsdale, Ariz. has a company, China Motor Corporation, which aims to have two Chinese vehicles in dealerships by next year—before the end of 2005 if he has some luck with the pollution and safety tests going right. Shelburg has the North American rights to distribute Geeley, Great Wall and Zhongxing vehicles. he has thirty dealers in 11 states so far, but he’s going to need a lot more to hit the 75,000 in sales in 2006 he says is possible.
Automotive entrepreneurs are dreamers. Think Preston Tucker, Henry J. Kaiser,Walter Chrysler and even John DeLorean. There is something about cars that attracts such people. Bricklin helped found Subaru and went on to found Yugo America. He also started a company that made The Bricklin.” Of course, these dreamers want a car named after themselves.
My question, which will only be answered with time, is whether men like Bricklin and Shelburg, in 2005, really have the gravitas, money and heft, as well as the dreams, to play in the global car business and do something as lasting as introducing, and then maintaining, China’s entry into the U.S. car business.
Shelburg has been unsuccessful bringing Russian vehicles to the U.S. And Bricklin’s last big play was Yugo in 1985, two decades ago—before the World Wide Web and all the changes to business that have accompanied the Net.
Like I said, only time will tell if they can pull this off. But I’m pulling for the dreamers.