China's Chery At The Gates Of The EU

Bertel Schmitt
by Bertel Schmitt

The feared Chinese car exports so far have been a dud. The value of car imports beats exports 3:1. This doesn’t dissuade privately owned Chinese carmakers from trying. They are active at the soft underbelly of the world, in developing or emerging markets of South America and Africa. Now, they are getting a bit closer to Europe.

China’s Chery cooperates with Turkish automaker Mermerler Otomotiv to build a Chery plant in Turkey. When finished, the plant will build Chery’s A3/Niche and Change sedans as well as a small SUV, most likely a version of the Tiggo, Gasgoo reports. The plant will have an initial capacity of 20,000 units per year, by 2017, capacity should be ramped up to 100,000 units per year.

The plant is will be in Turkey’s Sakarya Province, not too far from Istanbul. That puts it close to the EU, but not into the EU. Turkey has been trying for long to be a member, but Brussels is more interested to take in powerhouses such as Bulgaria and Rumania, and gives Turkey the cold shoulder.

Because Turkey is not subject to stringent EU rules, and because Turks like a deal, Chery has enjoyed brisk demand in Turkey.

This is Chery’s second attempt to get a foothold in Europe. Chery had plans to acquire the Polish Fabryka Samochodow Osobowych (FSO) factory, which is currently owned by Ukrainian corporation Ukravto. Nothing came of these plans so far. Poland is in the EU.

Bertel Schmitt
Bertel Schmitt

Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.

More by Bertel Schmitt

Comments
Join the conversation
 6 comments
  • Uncle Mellow Uncle Mellow on Nov 07, 2010

    This thing looks OK , for an SUV. Turkey may well join the EU - there are members for-and-against the idea.

    • See 1 previous
    • Joeveto3 Joeveto3 on Nov 07, 2010

      I think that's actually a great business model. Just shamelessly copy prior (beloved)generations of vehicles and "re-introduce" them to the market. Miss that old Mitsubishi Eclipse? Not anymore! How about the original Honda Odyssey? Here you go. Want a brand new Chery Citation? Ok, bad example. (But it's only $3500 and we installed the radio with a horizontal orientation in the dash rather than a verticle, up and down orientation, like the original...) Maybe that's the Best Business Model: Take cars from the past that were novel ideas but shitty executions, and apply Chinese level of technology and innovation. Essentially, you'll get a 70's Ford Maverick with 1997 levels of sophistication. Think of it, you could actually have a Prymouth Fury, or a 72 Cutrass with airbags and ABS! Dodge Mirada with fuel injection and auto-off headlights anyone?

  • Marcelo de Vasconcellos Marcelo de Vasconcellos on Nov 07, 2010

    never say never

  • Blowfish Blowfish on Nov 07, 2010

    Barbarians are linning up all their ducks in a row outside the gate. See if the maginot line can save this time.

  • Dave Dave on Nov 07, 2010

    "... powerhouses such as Bulgaria and Romania..." Bertel, you have a wicked sense of irony. Their major exports are people to the rest of the EU (and France is trying to return most of them)

Next