China to Foreign Automakers: Yankee Go Home!

Bertel Schmitt
by Bertel Schmitt
china to foreign automakers yankee go home

It’s an open secret in Chinese industry circles: within the next six to eight years, the domestic auto industry wants to stand on its own technological feet, instead of relying on U.S., European and Japanese joint venture partners. At after-work hangouts, such as “ Schindler’s Anlegestelle” around the corner from Volkswagen Group China’s headquarters in Beijing’s bar and embassy district Sanlitun, fare-well parties for managers heading home are already decreasing. In the name of the almighty efficiency, most foreigners have already been replaced by supposedly cheaper Chinese. And now, no more pussy-footing around. According to, which read it in the Beijing News, which cited a faceless industry analyst, Chinese industry giant FAW is “focusing its human, financial and material resources on making cars of its independent brands.” The joint venture partner of Volkswagen, Mazda, and Toyota “aims to sell two million vehicles by 2010, and half of them must be FAW’s own-brand vehicles.”

In 2007, FAW sold 1,465,000 vehicles, which include 620k own-brand vehicles. According to China Knowledge, the FAW Group reported very robust auto sales growth of 17.1 percent for the January-September 2008 period. However, their own-brand vehicles are overweight in the commercial sector; passenger car output is dominated by joint venture models. From January to September, FAW sold 382,845 VWs (and Audis), 283,464 Toyotas, and 90,485 Mazdas. Even FAW’s “own brand” models are mostly based on foreign platforms.

In related news, FAW has announced that they will fold their own and formerly illustrious “Red Flag” brand for good, and rename it to “Shengshi” (“Days of Prosperity”). Chairman Mao’s ride, repositioned as a capitalist’s tool. The Red Flag brand had anemic sales of 788 units in the first six months of 2008. Its flagship HQ3 is based on the Toyota Majesta. New models in the “Days of Prosperity” lineup will be developed by the Austrian engineering house Magna Steyr, designer of Mercedes-Benz’s “4MATIC” and the BMW X3. As hard as the Chinese may try, some foreigners will be around for a while.

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  • Dilbert Dilbert on Oct 23, 2008

    "the risk of your venture being nationalized on a whim and/or your ex-pat employees being tried and convicted of whatever the government can make stick." That's Russia, whom has a bone to gnaw on vs. the West. I don't think there are any examples of that in China. It's obvious to anyone that's walked in the central business district in Beijing, that there are tons of US/European companies making big bucks in China. Funny that you mention Sanlitun, it wouldn't exist if it weren't for the rich expat community. And not just rich relative to the local population, rich compared to the average Joe in the US. When those expats return, they aren't driving a Malibu.

  • BertelSchmitt BertelSchmitt on Oct 23, 2008

    “the risk of your venture being nationalized on a whim and/or your ex-pat employees being tried and convicted of whatever the government can make stick.” Exactly. Got the countries confused. Foreigners are being treated like royalty here. This may sound like heresy, but heck, I've always been a heretic: I have lived and owned businesses in Europe, in the USA, and in China. On all three continents for a long time, successfully, and intensively. Nowhere have I experienced more freedom and less interference than in China. In Europe, you get taxed, regulated, and controlled to death. In the US, lawyers make your life a misery once you make some money. Don't dare to get married or sell auto parts. If you love capitalism, you'll adore China. They say "Happiness is an American house, a Japanese wife, and a Chinese cook." Hey, I traded in the house for the other two. And thank God, I did it just in time, two years ago .....

  • ToolGuy From the listing: "Oil changes every April & October (full-synth), during which I also swap out A/S (not the stock summer MPS3s) and Blizzak winter tires on steelies, rotating front/back."• While ToolGuy applauds the use of full synthetic motor oil,• ToolGuy absolutely abhors the waste inherent in changing out a perfectly good motor oil every 6 months.The Mobil 1 Extended Performance High Mileage I run in our family fleet has a change interval of 20,000 miles. (Do I go 20,000 miles before changing it? No.) But this 2014 Focus has presumably had something like 16 oil changes in 36K miles, which works out to a 2,250 mile average change interval. Complete waste of time, money and perfectly good natural gas which could have gone to a higher and better use.Mobil 1 also says their oil miraculously expires at 1 year, and ToolGuy has questions. Is that one year in the bottle? One year in the vehicle? (Have I gone longer than a year in some of our vehicles? Yes, I have. Did I also add Lucas Oil 10131 Pure Synthetic Oil Stabilizer during that time, in case you are concerned about the additive package losing efficacy? Yes, I might have -- as far as you know.)TL;DR: I aim for annual oil changes and sometimes miss that 'deadline' by a few months; 12,000 miles between oil changes bothers me not at all, if you are using a quality synthetic which you should be anyway.
  • Carlson Fan Doesn't it take electricity to make hydrogen? Why not just charge a battery. Seems like that would be more efficient & clean not factoring in all the pollution it takes to manufacture today's batteries. But maybe fuel cells are just as bad, not sure about that. A hydrogen vehicle is nothing more than an electric car where hydrogen gas & a fuel cell are used in place of a battery.
  • Deanst A friend with a Model Y pays to park and then pays to charge because he can get a quick supercharge. He says other supercharger stations with free parking are not as fast.
  • Carlson Fan At home always for the 7 years I've owned my Volt. Never once used a public charger.At 40+ MPG, It's cheaper to just burn gas if I need to get home versus paying the ridiculous rates at a public charger.
  • Deanst I applaud them for trying something different, even if I question its appeal.