Texans Buy Stake in China's Brilliance
Les Alexander is a money man (bond trader) who owns the Houston Rockets. Billy Joe "Red" McCombs co-founded Clear Channel Communications and owns a huge network of Texan dealerships and aftermarket auto parts businesses. The Houston Business Journal [via Mlive.com] reports that the two men have bought a ten to fifteen percent share in the Chinese automaker Brilliance, for a cool $100m. McCombs wants Brilliance to use the money to develop Chinese dealership networks, auto financing, used car operations and Internet auto sales. "There's huge opportunities in China for companies to set up aftermarket services like leasing, vehicle loans and extended warranties," says Charles Child, International Editor of Automotive News. "All the kinds of things that U.S. car shoppers are offered every day." If the venture is successful and market share grows, Brilliance hopes to import cars to the United States "at prices under those for the Korean Hyundai and Kia brands." Yeehaw! Or should I say Ni Hao!
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I wonder what will happen to Autokam? They apparently already have an agreement to import Brilliance cars into the US. Of course, I could be really sarcastic and remind everyone of how Chery went back on their signed agreement with Visionary Vehicles to sign-on with Chrysler LLC. http://autokam.us/ http://brillianceauto.us/home/index.html I read something very interesting from the viewpoint of an executive in Egypt who indicated that it was difficult to work with the (PRC) Chinese because not only was their word no good, but their written contracts were also worthless. Today I was reading something about how the Russians can simply re-nationalize companies with huge losses by stock holders, and there are no morals or scruples. The writer did a "Captain Obvious" by pointing out that this is what happens in a nation which eliminates a moral compass with communism for 4 generations. Likewise (PRC) China.