By on December 21, 2011

One question that Bertel and I find ourselves returning to again and again in our regular conversations is “what will be the first Chinese-made car sold in North America?” We’ve agreed for some time that the groundbreaking first Chinese-made import would come from an established non-Chinese brand, rather than one of the many newer Chinese brands, but our usual suspects typically ranged from GM to Volvo (EV maker Coda builds what are essentially “knock down” Chinese made-cars, but technically they qualify as US assembled, as does Wheego). I don’t think the name “Honda” ever came up in these discussions, but sure enough, the NY Times reports

the Japanese automaker Honda is crossing the threshold by importing subcompact cars into Canada from one of its plants in China. This month, Honda Canada began receiving its smallest model, the Fit, from China instead of Japan, as part of a strategy to produce more vehicles outside its home country.

The decision allows Honda to eke out higher profit in a segment of the auto market where margins are extremely thin, especially since the high value of the yen cuts into all Japanese automakers’ overseas operations.

“The yen has been getting stronger and stronger,” Jerry Chenkin, executive vice president of Honda Canada, said on Tuesday.

Of course, Honda has yet to bring a Chinese-made Fit to the US, where antipathy towards Chinese products is greater and automotive diversity is lesser than in the Great White North. Also, the importation of Chinese Fits is seen as a temporary response to the high Yen, while Honda builds a new plant in Mexico for Fit production, scheduled to open in 2014. Still, this is a significant development, presaging the inevitable importation to the US of Chinese-built vehicles.

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32 Comments on “Chinese Cars Have Arrived, As Honda Imports Fits From The Middle Kingdom...”


  • avatar
    Trend-Shifter

    I hope when that day occurs that a China car is destined for our shores that we hold up a mirror and state that every tariff or tax that is applied to a US manufactured car in China will be added to ALL Chinese vehicle types for 5 years.

    That would open up the China market and reduce trade distortions. If it became a trade war, the American worker has nothing to lose.

    • 0 avatar
      bikegoesbaa

      If it became a trade war, the American worker has nothing to lose.

      How about access to inexpensive Chinese-made cars?

      Based on their current buying habits, I suspect that’s a class of product that would appeal to many/most “American workers”.

      • 0 avatar
        damikco

        “How about access to inexpensive Chinese-made cars?
        Sorry Ill take my American made job providing, and trade deficit friendly American car.

      • 0 avatar
        bikegoesbaa

        OK, and other people may wish to “take” other things based on their own priorities, which may not align with yours.

        You don’t have to agree with these choices, but your preferences probably aren’t sufficient justification for restricting them.

      • 0 avatar
        highdesertcat

        Personally, I am all for more choice in the marketplace, and that includes vehicles made in China, India, alkies from Brazil, and hot rods from Australia.

        That way, the US consumer/buyer at least has the choice to vote with their wallet.

        Right now we, the people who own one nationalized American auto manufacturer, are severely limited by what our government allows us to choose from. And that is mostly driven by what the US auto industry lobbyists tell Congress what to allow to be sold here. Mahindra is out. Chinese-built are out.

        When I was stationed in Europe with the US military I had a field day with Euro-spec cars. I bought them, traded them, fixed them up, tooled on them, learned from them. What they have available in Europe may not always be as fancy as what we get to choose from in the US, but the variety is far greater. One of my favorite was my old NSU RO-80. Another was my even older DKW 3=6.

        During my tour at Kadena AB I got a good look at Asian cars available in Japan, and even there the choice is greater, and the prices for new and used encompass all levels of incomes and needs.

        Just as in the 70’s, 80’s and 90’s Americans flocked to the better, more dependable imports and transplants, more buyers in the US may find their transportation needs in Asian imports, if they would only be allowed to be sold in the US.

        As long as imports meet or exceed US DOT standards they should be available to anyone in the US who wants one. We let travelers or visitors from Mexico or Canada drive their imported vehicles that do not meet US DOT standards on our roads. It only matters to GM and Ford what we can buy in the US because it means they have to face even more competition.

      • 0 avatar
        mallthus

        @highdesertcat

        I agree with your conclusions even if I disagree with the way you got there.

        Like you, I look at the choices available in other auto markets and wish that we too had access to some of those vehicles, but I think the reasons why we don’t have them are far more nuanced and complex than the picture you paint.

        I don’t see the issue as one of a monolithic US auto industry and I think we have mostly ourselves to blame for our lousy choice of cars.

        Europe is often accused of being a continent of over regulated nanny states. That may or may not be true, but many of those regulations are designed to create a fair marketplace where product manufacturers are obligated to provide complete and accurate information about their products to consumers.

        At that point, we diverge from Europe (and Asia and Australia) because although we demand labeling, we mostly opt to consider our people too stupid to understand said labeling. We force cars to have airbags designed for people too dumb to wear their safety belts. Europe adds a full tax burden to fuel to both cover transport related expenses and deter the purchase of inefficient vehicles…a market driven solution, we mandate corporate fuel economy standards that the customer never really sees (or has to think about).

        Finally, liability is the elephant in the corner. In Europe, the overriding principle is that of “Buyer Beware”. If you buy a micro car and you’re killed by a truck, that’s a risk that you willing took on when you bought a little car. In the US, the lawyers are going to be there before your body’s cold, proclaiming that (insert auto maker here) should never have sold you an unsafe car like that and should pay your heirs a few million bucks. The net result is that nobody is going to sell you that microcar no matter how much you ask for it.

      • 0 avatar
        highdesertcat

        mallthus, my comment really was aimed at more choice since I am not a candidate for a micro-car. For instance, during my most recent trip down under I saw some pretty nifty cars going balls to the walls in the outback. Those are not available to us in the US.

        But as far as choice is concerned, many people have chosen, for instance, Hyundai cars. They are like cockroaches on the roads; they are everywhere!

        I would like to see MORE choice in the US market place, not necessarily micro-cars, and cars made in China and India, or even Australia and Singapore, would provide options for many people who are not attracted to buying Toyondasan, HyunKia, Fiatsler or Ford and GM products.

    • 0 avatar
      tekdemon

      And that’s how you lose the game. China’s tariffs on US vehicles were actually very carefully crafted and calculated to offset the tariffs generated on Chinese tire imports. Randomly proclaiming that you’re going to slap taxes on everything doesn’t really threaten the Chinese so much as threaten US exports. Sure, China exports lots of cheap crap to us right now but you don’t seem to realize that the Chinese government doesn’t care for China to continue to be an exporter of cheap crap. They don’t *want* China to be seen as an exporter of low cost goods, so while it’d sting in the short run in the long run they’d probably be plenty happy that you basically jacked up costs for all US consumers and doomed the US economy while forcing their own companies to stop building cheap crap. The Chinese economy is only about 10% export driven and of that 10% the US only makes up a minority fraction. Even if they exported NOTHING to the US they’d be fine. It’d sting in the short term but in the long term the high inflation caused by the US not importing any Chinese made goods would hamstring our economy to help them become #1 a lot sooner.
      http://www.economist.com/node/10429271

      • 0 avatar
        Dynasty

        “Personally, I am all for more choice in the marketplace, and that includes vehicles made in China, India, alkies from Brazil, and hot rods from Australia.”

        What I’m for is trade laws that are fair for the United States, that don’t handicap our companies. I’m for foreign companies having to abide by the same environmental laws our companies have to deal with. I’m for our trading partners not manipulating their currency which artificially lowers their prices. But what I’m really for is not every Tom, Dick, Harry, Betty and Sally in this country having this secret dirty desire to see the United States fail?

        Where is this coming from?

    • 0 avatar
      Dynasty

      As if the feminization of the US hasn’t made being a man in the US a bad thing.. As if the non-white agenda in the US hasn’t made being a Caucasian a bad thing. As if the politically correct movement hasn’t made common sense a bad thing.

      But now, and for some time, we have a movement which has made it a bad thing for Americans to have well paying jobs.

      Answer me this bikegoesbaa: What if it were your job, your livelihood, your mortgage, food on the table for your family that was outsourced?

      Why is it not okay for the citizens of the United States to have any nationalism for their country and support their brothers and sisters so they too can have well paying jobs? Does everything really boil down to purely the bottom line?

      Trendshifter: “That would open up the China market and reduce trade distortions. If it became a trade war, the American worker has nothing to lose.”

      That is not entirely true. There are still some major US employers like Boeing and Caterpillar that export a lot to China.. Until China steals their IP…. But I understand where you are coming from.

      10-20 years from now, all these companies setting up shop in China are going to have a rude awakening when all their IP has been stolen and they are no longer needed. But who cares right?? Cuz we’ll be getting real cheap cars from China!

      • 0 avatar
        Athos Nobile

        “But what I’m really for is not every Tom, Dick, Harry, Betty and Sally in this country having this secret dirty desire to see the United States fail?”

        It seems like people needs to be reminded that if the *ship* sinks… everyone goes down with it.

        In the end a country is like a *ship*… and everyone living in it is a passenger.

    • 0 avatar
      Norma

      @trendshittr,

      While all you care is the import of Chinese cars, Correct me if I’m wrong, didn’t the U.S. just signed a FTA with, drum roll plz, S. Korea, the home country of the fast rising imports of Hyundai-Kia?

      Haha.

  • avatar
    ritchie628

    While it may not have come up in conversation between yourself and Bertel, the possibility has been brought up before by Mr. Baruth:

    http://www.thetruthaboutcars.com/2011/03/a-thousand-points-of-light-and-a-chinese-concern/

  • avatar
    catnett

    Apple seems to have no trouble selling Chinese-made products of great complexity and quality at premium prices. I used to harbor ill will towards Mexican-made automobiles – everyone remembers VW’s early teething troubles – but the Hecho en Mexico Ford Fusion has proven to be one of the most reliable cars around. I can’t see why the Chinese can’t make automobiles as well as the Mexicans eventually.

    • 0 avatar
      mallthus

      “I can’t see why the Chinese can’t make automobiles as well as the Mexicans eventually.”

      I’ll add that to my list of phrases that I never thought I’d hear, let alone agree with.

      • 0 avatar
        bikegoesbaa

        What part specifically don’t you agree with?

        Do you honestly think that Chinese people are unable to manufacture quality products?

        If anything, the automakers’ experiences manufacturing in Mexico prove that with good designs, robust processes, and appropriate levels of technology a quality car can be made anywhere.

      • 0 avatar
        damikco

        http://blog.sfgate.com/techchron/2011/07/20/fake-apple-store-in-china/

        THEY DO!

  • avatar
    forraymond

    Free Trade ISN’T FREE!

    As for Americans wanting inexpensive Chinese built cars…I am sure Americans would prefer jobs that pay enough to buy most any car, not just the cheapest offerings from poorly paid workers from other parts of the world.

    • 0 avatar
      bikegoesbaa

      Well, I know the best way to find out what people prefer: Give them the choice to buy what they want, and then see what they do.

      This sounds like a much better option than “Have forraymond decide what everybody else should buy and then write the laws to ensure that this happens.”

      Mostly, I dispute the earlier contention that “The American worker has nothing to lose” if a trad war artificially increases the cost of inexpensive cars.

      Sure, the a guy building Cruzes in Lordstown may like not having competition from China. A waitress in Dallas may want a new car that allows her to reliably and safely get to work, and she probably would prefer that it not have an artificially inflated price due to protective tariffs.

      I don’t see any reason why the interests of the guy in Lordstown are inherently more important than the interests of the gal in Dallas. Aren’t they both “American workers”?

      • 0 avatar
        damikco

        The problem is just that. Most jobs here dont pay enough and the cost of living in America is so out of proportion with with compensation. The guy working in Lordstown has a “living wage” paying position and your waitress should really be in a used car.

      • 0 avatar
        bikegoesbaa

        You realize that protective tariffs raise the cost of goods, which contributes to the “problem” you are complaining about, right?

        You are complaining about the cost of living while simultaneously advocating policies that raise the cost of living, and disproportionally impact the lowest earners.

        While it’s very nice and paternalistic of you to tell lower-income workers what they “should” do, they would probably just prefer that you allow them to make their own choices, and not artificially raise the cost of economy cars.

      • 0 avatar
        Dynasty

        Arguing with the devil’s advocate is so much fun.

        What people prefer or want and what they actually purchase are two different things.

        I’d prefer a Maserati Quatroporte, but I’d be much more likely to purchase a Toyanda Camcord.

      • 0 avatar
        Dynasty

        bikesgobaa: You are only looking at things from a very narrow focus and not the big picture.

        China manipulates their currency which ARTIFICIALLY lowers the price of everything they sell giving them a very large unfair advantage.

        That then forces US businesses to relocate production to take advantage of this delta, or go out of business. So not only does this eliminate decent paying jobs, but it lowers the rest of the 99%’s standard of living.

        But good thing we have all these artificially low price goods from China coming in.

        While I don’t agree a trade war would be a good thing, but standing on the “protecting the poor people” soapbox from not having the choice to buy cheap chinese cars is ridiculous.

        What would be a whole lot better for poor people, and the US as a whole, would be access to better paying jobs. And a government that actually gave a damn about the country and wasn’t such a bunch of pussies dealing with this communist regime.

        Or are you really a Chinese person defending your country?

  • avatar
    Mark MacInnis

    The body has some interesting features.

    The car’s nice, too….. :^}

    Seriously,though. If the Chi-coms tariff our cars, we should DOUBLE-tariff theirs.

    There, that’ll show ‘em…..

    What? Beijing just called? They want us to pay up on the bonds they own? ……

    Ooooooops.

    • 0 avatar
      damikco

      It’s only 1.2 Trillion and it’s something we CAN do. On the other hand if a trade war occurred they would loose big since we import more from them then they do from us. I say bring it on a trade war would create more jobs in the U.S. and bring far better quality and safer made products for our consumers.

      • 0 avatar
        Dynasty

        Trade war would be bad.

        What we need is accurate currency valuations.

        Oh, what’s that bikegoesbaa? That wouldn’t be fair for the waitress in Dallas because all of sudden the cheap products from China aren’t so cheap anymore? And now the cost of everything has gone up 25%?

  • avatar
    hriehl1

    To me, the issue has more to deal with the Chinese near-total disregard for intellectual property rights which they’ve demonstrated time and again. That’s why even with the auto-building joint ventures, western partners are reticent to bring their most advanced designs and manufacturing techniques into China.

    The best example of the dilemma is pharmaceuticals… it costs 2 cents to produce the pill but $200 Million of R&D to develop it. Patent protection provides innovators time for pay-back.

    I believe innovators deserve rewards for their huge risks… too often China simply steals (my word) from those who’ve succeeded in the innovation game by leveraging their low production costs.

    Not to mention, again my words, their piss-poor QA and complete lack of loyalty in business relationships.

    • 0 avatar
      Frownsworth

      Surely you are not thinking that modern incorporated businesses really possess ethical values such as loyalty ?

      Large patent portfolios speaks volumes to anti-innovative attitudes and anti-competitiveness of which the market is full of.

      I guess what I would say is true at the least is that the Chinese surely are transparent about (some of) their business conducts.

      • 0 avatar
        hriehl1

        An interesting perspective.

        Our differing views probably reflect our differing roles in the economy. I’ve been involved with innovation and patent disputes, and yes, many (but not all) patent-holders do not seek to develop markets but instead seek to restrict them. But I’ve also seen the massive amounts of capital it takes to innovate.

        But I do disagree with your assertion that modern corporations do not posess ethics or loyalty. We hear in the news of the exceptions (esp. closures and layoffs, many caused by foreign “competition”) but what is not reported are the millions of profitable deals done everyday between long-term business partners. A successful customer-supplier relationship goes beyond low price… there’s service, quality, reliability and many other components.

        In my experience, these are not elements recognized or appreciated in China (or India). With them, its all about grinding out every last bit of profit in THIS deal, even knowingly screwing your trading partner in the process.

  • avatar
    Sketch

    I wonder if Honda might be the only one easily capable of this.

    One thing I noticed when visiting Shenzhen was that there were a lot of Corollas, Focuses, Versas, Tiburons, etc…but they all looked slightly different than the models you see in the rest of the world…many are just different front/rear clips and minor styling differences, but some looked significantly (structurally) different. I assume that means they build things a bit differently for their joint ventures. But in contrast, I noticed that all of the Fits, Citys, and Civics looked exactly like their rest-of-the-world counterparts.

  • avatar

    Ok so Honda imports them, Toyota builds cars in china, and vw makes skodas there but doesn’t tell, so we think we run German and/or Czech cars. Who’s being fooled? And if they’re made in china, so what? All of our electronics are made there. Our clothes are. Our toys are. And everything else is. Except maybe wood and bricks. For now.

  • avatar
    fabriced28

    Honda is exporting the Fit from China to Europe since 2005.
    Have a look at http://world.honda.com/news/2005/c050624.html.

    The low dollar has just kept it away a bit longer… But if Honda was the first to do this in Europe, it’s quite logical that they are also the first in the US, and with the same car, probably from the same plant.


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