Ghosn Sees One Or Two Global Chinese Carmakers. Eventually
The Chinese quest to own a large Chinese automaker with global reach fell on sympathetic ears with someone who should be scared of the yellow peril: Carlos Ghosn. After all,Ghosn is in charge of two automakers. Nissan is the largest Japanese brand in China. Renault is trying to get traction in China. At the Thomson Reuters Newsmaker event in Tokyo today, Ghosn said he does not only expect one or two large Chinese automakers to emerge on the global market, he also understands why.
First, Ghosn had interesting news for those who think there is no money to be made in China:
“For carmakers, China is one of the most profitable markets in the world. It used to be the United States. Now it is China.”
Ghosn explained that Europe is by and large in the hands of European automakers. The Korean market is nearly 100% in Korean hands. Japan’s auto market is dominated by Japanese. Even “the Americans still hold a substantial market share in the United States.” Then why should the world’s largest auto market be left to the foreigners? Said Ghosn:
“When the government in China says, hey, this is a huge industry, we want to generate a Chinese champion, then that’s logical, it’s normal, we are expecting this. Is this a handicap for us? I don’t think so. It’s a factor. We are facing it everywhere.”
“We are expecting presently that there will be at least one or two global makers coming out of China .How this is going to take place, nobody knows. What is going to be the company, nobody knows. It probably will go through acquisitions of pieces of other companies outside of China, but at the end of the day it is going to happen.”
Ghosn thinks this is a while off.
“I think it is going to be some time before we see a major Chinese makers competing globally. At least five years. Unless there is an acquisition.”
Ghosn mentioned Volvo and Geely en passant, but didn’t see it as a game changer. Saab never came up. Ghosn said it needs a “volume maker.” He stressed “volume maker” several times.
When Paul Ingrassia mentioned Opel, Ghosn sidestepped the issue, and said “I’m not going to give you names.”
Through the power of YouTube, you didn’t have to travel to Tokyo to hear Ghosn uncut. The unedited, full length video on YouTube is required watching if you are interested in where this industry is heading.
Vance Torino on Jun 23, 2011
As I see it, Opel is the real wild card here. GM is obviously and correctly ambivalent about it - its main problem being those nasty "legacy costs" associated with a very expensive European workforce. Unlike American GM's bankruptcy, they don't seem to have offloaded those costs. So GM is weighing whether a Chevrolet-based push with American and Korean engineering can make up for the loss of Opel's engineering. The moral of the story is that whoever ends up with Opel better have REALLY DEEP pockets... like a state-backed Chinese company. So... BAIC it is!
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