Quote Of The Day: Mo' Volume, Mo' Problems Edition

Edward Niedermeyer
by Edward Niedermeyer

Why should I want to be Toyota? They’re losing billions.

Today’s Quote Of The Day comes from the executive of a certain up-and-coming automaker with dreams of becoming a global player. Think you know who it is? Here’s a hint: it’s not Ed Whitacre.

Geely CEO Li Shufu is the man responsible for that little nugget of wisdom, as he gloats about his firm’s success to Bloomberg. With $334m in backing from Goldman Sachs and a stock that rose 573 percent on Honk Kong’s Hang Seng index this year, Li has good reason to be confident in his company. But confident enough to ignore the keys to Toyota’s success, which has been unmatched in the industry until about 18 months ago? Not quite. Li’s bon mot was more of a jab at archrival BYD, which has publicly stated that it intends to surpass Toyota by 2025. In fact, just a year ago Li told Gasgoo:

We would like to be a global brand just like Toyota. We will make the products at locations close to the market, and develop our models and technology in line with demand. We will produce many models at a low cost, just like Toyota.

In any case, Geely’s ability to compete with Toyota will soon be tested outside of the Chinese domestic market. In August, Geely begun production of its first “global” model: the Emgrand EC718. As this ad unsubtly indicates, the EC718 is clearly intended to be Geely’s warning shot at the West. However, even China Daily admits that Chinese manufacturers are finding the European market a tough nut to crack, with five Chinese firms selling only 745 units in the EU in the first three quarters of 2009.

Edward Niedermeyer
Edward Niedermeyer

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  • Dimwit Dimwit on Dec 30, 2009

    The past history of the Chinese is telling: they can and will make a decent product. One. After that they will shave and chivvy until it's crap and it won't take long. They will do it over and over, wasting brand equity until nothing is left. Watch SAAB for the arc. A good, proven design. Still fairly thought of. Within 5 years you won't be able to give one away.

  • Don1967 Don1967 on Dec 31, 2009

    If the Japanese and the Koreans could turn things around and become bona fide global players, why not the Chinese? Their potential is huge. But there are also risks in depending heavily on cheap, domestic labour that is under communist rule. Political unrest, rising shipping costs, and a devalued U.S. dollar could all take some of the air out of the China bubble.

  • Shaker Shaker on Dec 31, 2009

    I type this on a Chinese-made laptop - a high-quality item that's given me no trouble in 3 years. This is due to the OEM (Asus) developing stringent requirements (usually based on ISO standards) that the manufacturers must follow. Since the Chinese car companies won't be overseen by external forces (except for the safety requirements of the destination country of sale), they'll be free to cut corners (which will doom them), or try to build brand equity with quality product (at first, anyway). If this succeeds in destroying competition to the point where the only affordable cars will be Chinese-built (like most of our consumer goods), then it will be 'mission accomplished' for the Chinese - they will become the predominate manufacturer of the world, and THEY will set the ISO standards. I think we all know what that could mean.

  • Windswords Windswords on Dec 31, 2009

    Volvo's lament (Sung to the tune of Shoo Fly) Shufu, don't bother me Shufu, don't bother me Shufu, don't bother me For I (used to) belong to somebody