Do You Know Enough About China?
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  1. #1
    JBN
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    Default Do You Know Enough About China?

    This is one of the most interesting and thought provoking talks I have heard for a while. I know that this forum is centred on French cars, but it doesn't take much imagination to realise that in 10 or 20 years time, we may also be driving Chinese cars, even if it is just as a chauffeur.

    I commend to you to take some time to watch this video. It is not political, sexist, voyeuristic or funny, so some of you will have to make an extra effort to watch it.

    http://www.usfunds.com/investor-reso...k-talk/?i=4915

    John

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    1000+ Posts dino's Avatar
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    Unfortunately not much new in that video...and I disagree with his opinion on europe. I think Europe is well aware of both opportunities and dangers by an ever growing china...As far as us driving Chinese cars (even as chauffeurs)...this is ridiculous... One isnt simply going to surrender 2000 years of our own civilizational evolution just to bigger numbers...Chinas biggest strength -THE STATE, is also its biggest weakness...should the time ever come...one would only need to cut the head from the snake to insure total anarchy...I think China knows where its destiny lies and its gentle and slow surrender to the west has long been evolving...one can hold onto tradiotnal values only for so long before the "golden arches" triumph...China, imo is simply in the process of becoming the new wild west...



    dino

    ps...still think its toad pond fodder

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    Chinese manufactures have tried now already for the 4th time to introduce their cars to the European market... and failed over and over again. To dangerous to drive (almost no crash safety) to badly put together, engines running far behind on effectiveness and fuel economy. No we have our cheap brands ourself and they comply with euro regulations. See for Dacia and Lada (both owned or major participation by Renault). Even the Koreans always know for their value for money are not so cheap anymore. And in Europe a lot of countries give benefits to those who by an eco friendly car (what's in a name). Here in Belgium you get 15% reduction payed by the government if you buy a car that emits no more than 104 gr/CO≤. Needles to say that now 25% of the cars sold are in that category.
    If the Chinese want their chair of the market they will need to close that gap and not rely on technology that was good 10 years ago.
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    1000+ Posts dino's Avatar
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    Quote Originally Posted by jurgen_s View Post
    Chinese manufactures have tried now already for the 4th time to introduce their cars to the European market... and failed over and over again. To dangerous to drive (almost no crash safety) to badly put together, engines running far behind on effectiveness and fuel economy. No we have our cheap brands ourself and they comply with euro regulations. See for Dacia and Lada (both owned or major participation by Renault). Even the Koreans always know for their value for money are not so cheap anymore. And in Europe a lot of countries give benefits to those who by an eco friendly car (what's in a name). Here in Belgium you get 15% reduction payed by the government if you buy a car that emits no more than 104 gr/CO≤. Needles to say that now 25% of the cars sold are in that category.
    If the Chinese want their chair of the market they will need to close that gap and not rely on technology that was good 10 years ago.
    I like how something so basic and simple like a pollution target/requirement can so easily keep a competitor out of the market...when the competitor starts to effect regulators (local scrutiny removed) this will lead to trouble...but as long as we dont surrender "our" values then China simply will have no option but to evolve to demands of greater buying power... so although for eg. mercedes and others will be more commonly built in china...its the "western" standards that will apply regardless...As long as the "west" is the more richer consumer then China will have to comply...and comply they will.



    dino

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    1000+ Posts gerry freed's Avatar
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    What you may well be seeing shortly is cars like the "CitroŽn" DS9 sold in Australia, with a brand of European origins, but made in China. You already get Michelin tyres from China, Renaults made in Korea, Peugeots and Cits from Turkey, UK and Spain and I think you get Suzuki cars made in India.
    The only issue of note is when cars designed originally for the Chinese market will be suitable for sale in mature markets elsewhere.
    Although Chinese brands are not yet ready to sell in Europe, the 'European' brands are increasingly sourcing components in China.
    Also bear in mind that the major players in the Chinese car market are VW and GM.
    I rode recently in a Renault Logan (with a lozenge badge) in India. It was built by Mahindra in India with parts supplied from Dacia of Roumania in a jv with Renault.
    Forget French and Chinese cars. This is a global industry, the branding is pure marketing and the parts sourcing multibranded and multinational.
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    JBN
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    I think there is already a Chinese car manufacturer that ONLY makes electric cars. They have no interest in last years technologies. With their high levels of pollution, they know that something has to be done. I would expect the Chinese to become leaders in battery technology for electric cars.

    The bottom line is that their economy is expanding at a startling rate. The USA is going backward at a frightening rate, and it would be much quicker if China wasn't buying their debt. From an Australian perspective, we are fortunate in that we have the resources that they want and agricultural production that is increasingly being bought up by Chinese interests to secure their food supply.

    John

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    1000+ Posts Kim Luck's Avatar
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    Default Chinese cars are the end of the story not the beginning.

    Every product you buy these days from well-known brands of old is now made in China. Why do you think their cars won't sell? Look at Mercedes. made everywhere in the world but Germany! It won't soon make much difference whose badge it has on it as soon as the bean counters can shift their production to China, they will! Or to India. Or to Pakistan. You dills better realise what Globalisation really means and pretty soon!
    Don't it always seem to go that you don't know what you've got 'til it's gone............

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    it has nothing to do with where the cars are made. BMW has factories in the states and the first cars made were refused because not up to bmw's standards. They send a german manager over there to get the things straitened out and to get production op to the finishing level that bmw wants. If cars are being manufactured in San Cucaraga changes nothing. If the finishing level is not up to the standards where the cars should be sold, people are not buying them.

    As for the 508: during the conception phase they have kept in mind the chinese market. China therefore will make the shift from the 406 to the 508.

    The reason why china is putting their money on 'green' technology is because they do not want to be reliant on their energy from other countries. It has nothing to do with pollution.
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    bob
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    G'day,

    us oldies, Ken & me, well remember when those funny little Japanese cars appeared here, Datsun & Honda particular weirdos, look at them now. My father in law was in the trade here when they arrived, one day a Datsun appeared in the shop and they had to take a door card off, the inside of the skin had food labels printed on it !

    It's just history going round and round.

    cheers,
    Bob

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    JBN
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    Quote Originally Posted by jurgen_s View Post
    The reason why china is putting their money on 'green' technology is because they do not want to be reliant on their energy from other countries. It has nothing to do with pollution.
    I disagree that the Chinese don't care about pollution. When you have smog at the levels that they have, it becomes a cost, particularly to peoples health. Going "green" on energy makes sense from a pollution point of view as well as having to rely less on external sources of energy. With China and India expanding their oil based transport, both the costs and availability of oil is going to be a problem in the future for us all.

    Those that make the change successfully to "green" power sooner rather than later will most likely reap the benefits. China is looking forward to a successful future. The USA and Europe are trying to dig themselves out of the financial abyss of the GFC. One is looking forward with anticipation whereas the others are looking ruefully at their glorious past.

    John

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    1000+ Posts dino's Avatar
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    Quote Originally Posted by jurgen_s View Post
    it has nothing to do with where the cars are made. BMW has factories in the states and the first cars made were refused because not up to bmw's standards. They send a german manager over there to get the things straitened out and to get production op to the finishing level that bmw wants. If cars are being manufactured in San Cucaraga changes nothing. If the finishing level is not up to the standards where the cars should be sold, people are not buying them.

    exactly...
    Jurgen, I think you ve hit the nail on the head...the whole point being to reduce cost but not quality...although it works fine in theory...there are precedents that show otherwise...but I do not believe that major global players like mercedes or even citroen will lower their standards..after all, having major players "create" stuff in your backyard brings a fair amount of "prestige"...Chinese can not afford to "forever" be seen as second rate manufacturers...look at the recent major projects..this isnt just done to impress chinese population...its done to impress "globally"...China knows that it must "follow" western standards if its to remain competitive...




    dino

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    JBN
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    Dino, just remember it was the rest of the world that followed China with its invention of gunpowder.

    China is like an Australian Bank. The USA is like a near bankrupt and very reliant on the bank. Europe varies (country to country) between being broke to being able to manage.

    The US produces excellent technology. The Chinese make that same technology and thus make money, selling it back to the US, who in turn use money borrowed from China.

    The world is changing from Yang (read Yank) to Ying (read China). That is the reality. It is no more palatable to me than it is to you.

    We have seen the British empire disappear within our lifetime. The fact that it originated in a small island off Europe was amazing. The fact that it came about by people that are infinately patient in standing in queues awaiting their turn, but slaughtered their way around the world to create such an empire is even more amazing (by the way, I was born a Pom).

    It will be interesting to see how China will act when it takes the mantle as the world's largest power in the not so distant future. It may not actually have to rely on armed force as was the case in the past. Its huge size geographically, huge population and huge manufacturing capabilities may mean that there is no need. Economic domination is cheaper and less bloody. They also don't have a spiritual need or belief based upon a missionary zeal to convert the unconverted.

    John

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    1000+ Posts Poo-Go's Avatar
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    All very true, John, 100%. I only disagree about the inevitability of US decline. They are and always have been forward-looking, and they may pick themselves up. History, however, favours the bankers. Whoever said mercantilism is dead?

    It's true that once China has overtaken the US's strategic dominance it's empire will be economic. But running an empire is a messy business, and a bit of hard power is an indispensable tool of persuasion, one that Chinese Communist Party leaders, so far not having demonstrated imprudence as a quality, are likely to keep on hand.

    It's also true that the Chinese have little desire to export the revolution, both isolationism and trade-only non-interference both strong ideologies running through the long history of Chinese civilization. But the same could once be said for the US's shorter history. Even now, it's far from absent in american thinking. But as mentioned - running an empire gets messy.
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    And things are changing rapidly in China too.
    In the past people did not dear to moan when things weren't happing the way they wanted. The younger generation dears to speak out loud the things that go wrong. See what is happening now with the factory that produces the Ipod and Ipad. This is a good example of the way things are changing in China... in fact the way it always did in the rest of the modern countries. People get fed up with being exploited and that only a small group gets away with all the money. Here in Europe they did a smart thing: include the east european countries into the Eurozone. In doing that those countries needed to comply with Euro regulations. That made the production cost go up. We are now in a situation where companies come back to their country of origin, because it is no longer worth while to have their things made in a low cost country (because it is no longer low cost).
    Now china is not going to step into whatever union, but you see that consumers start asking questions on how things are made over there. It is picked up by politicians and they are demanding China to do something about the harsh working conditions (because they want also that the production costs go up of course). Together with that and the growing fuel prices, it might turn quickly around for the big yellow. They depend largely on export of products.
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    Bob

    the first time I saw a Honda Z:

    It was at a KFC in Paramatta, my father had just mullahed the handbrake on our FB (pulled the handle right out of the socket at a traffic light) and this weenie teenie little purple thing which I assume a Z360 pulled up next to us.

    My how we laughed...

    We knew that was a deadend street right there, didn't we.

    I think those who dismiss the Chinese cars so easily should look at car reports on japanese cars from the 60s and 70s, and perhaps not be so bold in their pronouncements.

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    Default Car evolution may see some testing of the waters of the market.

    Quote Originally Posted by bob View Post
    G'day,

    us oldies, Ken & me, well remember when those funny little Japanese cars appeared here, Datsun & Honda particular weirdos, look at them now. My father in law was in the trade here when they arrived, one day a Datsun appeared in the shop and they had to take a door card off, the inside of the skin had food labels printed on it !

    It's just history going round and round.

    cheers,
    Bob
    Hi Bob

    Yeah that brings back some memories, a mate Peter Trull (now sadly passed away) of the Austin seven club restored one of the 1938? saloon style Datsuns and you could see that the body had been copied from English design/plans and mechanical bits cobbled together from what they had available to them, and the story was that one of the earlier tourer bodied cars had the shell oil imprint on the inside of the steel shell. Peter eventually sold the car to one of the Datsun dealers for display in Melbourne - its probably still around. I believe it was one that was taken into captivity during the New Guinea campaign in WW2 and bought back to Melbourne. But it is long time back so memory may be uncertain on the fine details.

    I reckon the turning point for chinese car imports, will come when they improve quality control and component parts to the extent they can offer five year warranty backup on their cars and have the quality good enough that they don't bankrupt the dealers and themselves in the process of stabilizing their entry to the market. Same with the Indian cars. I would not write them off if there was a determined effort to launch them on the Australian Market.

    And yes it is such a world market these days, its pretty laughable when people point to other marques as more reliable than .........car. As most of the components that need replacing come from the same suppliers and like the old ford parts, put in a different boxes to go to different manufacturers under their name.

    Most of the difference these days is the approach that the dealership and manufacturer have in replacing defective components. Some seem to just replace during routine service, so the owners don't experience problems on the road. Service and attention to customers can mask underlying problems of an irritating nature and gain customer loyalty. IMHO!

    Electric commuter cars will be a good testing ground for niche manufacturers and a horror pit, if done badly!!

    Ken

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    bob
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    Default Machine tools

    G'day,

    We currently look at machine tools from the Chinese with some suspicion, and with good reason. One of their factories has the manufacturing rights for the old South Bend designs, and they churn them out, right down to the last detail. Trouble is it is cosmetic, it is said that they have the little brass headstock oilers there and they look really nice, it's just there's no hole underneath !!

    They can make this stuff, they have been designing and building monster steam locomotives since who knows when. A pedestal drill at dad's of theirs from the 60's is build like a brick dunny, the motor is said to be a one third horse but looks and weighs like a current two horse job. The castings are real back breakers.

    So what happened with the oiler ? My guess is that they didn't have a real lathe to look at, the hole probably isn't on the drawings, wasn't necessary, there was an oiler there and the fitter putting it together knew a hole went with it.

    Obviously, the factories now churning out stuff for the world markets are run by the bean counters and staffed with process workers. The tradies and engineers will be where it really counts, heavy industry.

    cheers,
    Bob

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    The problem with Chinese stuff is that sometimes it's ok and sometimes it's awful. Like the knock off small Honda engines. Exact copies. From some factories ok, I've had one for a couple of years, but I'm told there are some about that are hopeless. There were imports of excavators in which the main mast was only 1.5mm steel and the buckets not much more than sheet. When you have something large and complicated like a car or tractor you only need one bearing that is made of the wrong steel and there's trouble. Most of the stuff in Bunnings is Chinese and it's ok but I don't think it will last long and never think about repairing it. Chinese farm motor bikes are cheap, but I just don't know. Always the short cut, the dodgy part that lets them down. Japanese ones are bad enough. Even something like fertiliser - smart operators have imported ship loads of Chinese superphosphate, what can go wrong there? But it's not right, they're having trouble getting rid of it.

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    JBN
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    A few weeks ago the Chinese unveiled their first stealth fighter, which says something about their abilities in that area.

    Chinese both in China and in Australia, have a strong emphasis on education. Compared with our own kids who are more focussed on binge drinking, and it points to quite different futures and aspirations. The number of engineers they must be churning out each year must be huge. Motivated by where they are at and have been and the prospect of a much better and more fulfilling future, they will be a force to be reckoned with. They are at the stage Britain was during the Industrail Revolution or the USA after the Civil War with their expansion westwards on the back of their railroads. There is a goal, there is a will and their is excitement at achieving milestones.

    That will all change when they become a democracy and get saddled with crappy politicians, but that is some way off.

    John

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    TRT
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    Quote Originally Posted by Poo-Go View Post
    All very true, John, 100%. I only disagree about the inevitability of US decline. They are and always have been forward-looking, and they may pick themselves up. History, however, favours the bankers. Whoever said mercantilism is dead?

    It's true that once China has overtaken the US's strategic dominance it's empire will be economic. But running an empire is a messy business, and a bit of hard power is an indispensable tool of persuasion, one that Chinese Communist Party leaders, so far not having demonstrated imprudence as a quality, are likely to keep on hand.

    It's also true that the Chinese have little desire to export the revolution, both isolationism and trade-only non-interference both strong ideologies running through the long history of Chinese civilization. But the same could once be said for the US's shorter history. Even now, it's far from absent in american thinking. But as mentioned - running an empire gets messy.
    I don't see the USA being infallible. It entered the 21st century in much the same way that Britain entered the 20th.

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    Default I my last couple of trips to China

    Quote Originally Posted by Russell Hall View Post
    The problem with Chinese stuff is that sometimes it's ok and sometimes it's awful. Like the knock off small Honda engines. Exact copies. From some factories ok, I've had one for a couple of years, but I'm told there are some about that are hopeless. There were imports of excavators in which the main mast was only 1.5mm steel and the buckets not much more than sheet. When you have something large and complicated like a car or tractor you only need one bearing that is made of the wrong steel and there's trouble. Most of the stuff in Bunnings is Chinese and it's ok but I don't think it will last long and never think about repairing it. Chinese farm motor bikes are cheap, but I just don't know. Always the short cut, the dodgy part that lets them down. Japanese ones are bad enough. Even something like fertiliser - smart operators have imported ship loads of Chinese superphosphate, what can go wrong there? But it's not right, they're having trouble getting rid of it.
    Nearly all taxis were Volkswagens (VW has been in manufacturing partnership in China for decades).

    Shanghai GM was one of the largest manufacturers of Chinese vehicles (essentially Chevs and Buicks everywhere)

    Citroen were making inroads with Chinese version of C4 in particular, but they started late and are not as well represented as others.

    Would not be at all surprised to see these appearing in Australia eventually. Although they will need to master right hand drive manufacture first.

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    Default A important side issue.

    Lots of opportunities, and I have friends too that are exploring business links and those opportunities, but there is also a caution bought about by a rather unfriendly system that wants to take any industrial information and exploit it with scant regard for patents, the inventors development right to profit from their designs etc, but are also so protective of their own system and state that you can easily run foul of either the state philosophy or protection of internal corruptive officialdom and family style organisations formed within the protection of the state.

    This "problem" will need to be addressed by the government before there is wider promotion of export products and the system learns to adapt and improve products, rather than just dump the image of cheap and low quality along with their export of consumer products. IMHO!

    Commercial protection of agents and enforcement of contractural agreements would also assist in the freeing up of entry and commercial operations within china. Its a bit of a minefield now.


    Ken

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    JBN
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    I fully agree Ken. Whilst in the adolescent stage, having procured their first car, its all go and the brain has some catching up to do.

    I think that it is inevitable that the Chinese system of government and the bureaucracy supporting it will change, with the push coming from both internal (the people) and external (trading partners). Probably not a bad time to start the process, given recent history in North Africa and the Middle East.

    John

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    Quote Originally Posted by TRT View Post
    I don't see the USA being infallible. It entered the 21st century in much the same way that Britain entered the 20th.
    I never claimed it was infallible, I don't know how you could possibly interpret that from what I said, which was that it's decline was not inevitable.

    You're entitled to your opinion (and you and I may not be too distant on this anyway), but if you're just itching to tear down someone else's as a way of presenting your own, at least read the first sentence of what the other person actually said!
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    Quote Originally Posted by JBN View Post
    I think there is already a Chinese car manufacturer that ONLY makes electric cars. They have no interest in last years technologies.
    There's a few, the most prolific being the company that makes those horrific ZAP things they recently banned in the States. Yes, they can do electric cars, but with yesterday's technology. Working with the Chinese every day, if you want billions of things made using existing technologies, they're OK. Anything else, forget it...I honestly don't know how big firms function over there without a truckload of European employees running the show.

    We are looking to Mexico, because our prime markets are the US and Europe. No-one's game to look at India - Maruti have been making Suzuki's for 30 years, and they still don't sell them out here (apart from the old Sierra truck design), which speaks volumes. There's a lot of other options.

    China's economy is expanding province by province. As places like Shenzhen explode with expansion, become too expensive, then slowly contract, so the next place takes over. Manufacturing over there will have to get smarter in the long term, before Vietnam, Thailand, Eastern Europe and Mexico start to take their business away. Chinese based R&D is only just starting (noticed leading Industrial Design magazines sprouting a trickle of Chinese design house ads the last 6 months), so will see how they go.

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