#China

When your author’s 2019 Golf SportWagen (to be revealed soon) went into the shop for warranty work after just two weeks of ownership, the dealer provided a service loaner for a couple days (or four). And it was a brand new Passat, but one company PR would never release into the hands of any journalist: the most basic version.

Let’s see if the spacious S sedan is an Ace of Base.

No, it won’t be shipped to the U.S. — only General Motors does things like that. Chinese customers, on the other hand, will soon be able to get their hands on a Lincoln vehicle built within their country’s borders. Orders opened late last week.

The 2020 Corsair is the first Lincoln-badged vehicle green-lit for local production by Ford Motor Company’s joint venture with Changan Automobile, and it should reach buyers in March. A key plank in Ford’s China 2.0 strategy, local production is seen as a way to reverse the Blue Oval’s sliding sales in the volatile market.

Next week, Tesla Motors will begin deliveries of its Shanghai-made Model 3 to Chinese customers — who stand to get a bit of a deal on them. Unlike Western markets, China is already loaded with local companies manufacturing electric vehicles and Tesla doesn’t want to lose out on market share simply because it priced its vehicles too high.

Originally, the manufacturer intended on selling introductory Model 3s at 355,800 yuan ($51,000 USD) a pop. That was soon lowered to 323,800 yuan ($46,500) to pull shoppers from automakers like BYD, NIO and Xiaopeng Motors. Broad profit margins are nice, but the Chinese EV market is too crowded for the brand not to focus on market share.

Tesla’s first foreign assembly plant will make its first deliveries — to a handful of employees — on December 30th, just shy of a goal marker it set for itself at the beginning of the year.

Construction of the automaker’s $2 billion Shanghai facility kicked off back in January with a promise to reach a production rate of 1,000-plus vehicles per week by the end of the year. While the plant’s production rate is not known, it received the necessary regulatory approvals for production in September, with the first Model 3s assembled in October.

The country’s new car market might be in a state of turmoil, but Tesla’s plans for China haven’t changed. It still wants to capture a big chunk of the country’s “new energy” vehicle market, and the creation of a wholly owned assembly plant, plus a range of local suppliers, makes the company’s goal a near certainty.

As it struggles to ramp up production at its Shanghai facility, Tesla plans to go on a price-slashing spree in 2020, a report claims.

China’s car market, officially the world’s largest, is bracing for its second year of negative growth. November was the fourth consecutive month of declining year-over-year sales, representing an improvement from October despite volume dropping 4.2 per cent below last November’s tally. Unfortunately for China, the downward trend has not been the exception, but the rule.

According to the Hong Kong based South China Morning Post, the China Passenger Car Association (CPCA) was hoping for better. “The market failed to live up to expectations of a strong rebound in November,” said Cui Dongshu, secretary general of the CPCA. “Consumer demand remained weak as people are reluctant to spend on big-ticket items due to worries about a bleak economic outlook.”

This matters in the West because domestic manufacturers have bent over backwards to try and improve sales within the region, expending no small amount of energy or capital in the process. China’s citizenry are also changing their tastes to cope with a weakening economy, and it would be wise to look at the choices they’re making.

If you follow the automotive industry at all, you’re undoubtedly aware that the United States is a region that hasn’t quite embraced automotive electrification on the same level as the rest of the developed world. Americans travel longer distances and have particular tastes, making EVs more popular in places like Europe and China. It also hasn’t passed the same sweeping regulations to ensure their advancement.

Whatever the cause, a new survey from London-based OC&C Strategy Consultants attempted to tabulate the disparity — asking 2,000 consumers (apiece) in the U.S., China, Germany, France and United Kingdom between March and April of 2019.

Their findings? Only about half of the surveyed Americans felt EVs were worth their consideration as a potential successor to their current ride. In China, 90 percent said they would seriously consider buying electric. Between 64 and 77 percent of respondents in Europe said the same (depending on country).

The coming year isn’t just the first chapter in a new decade, it will also be the final year you’ll be able to purchase a new Buick Regal. For that matter, it’s the last year you’ll be able to buy a Buick car.

Confirmed by a brand spokesman, the 2020 model year will be the midsize Regal’s last in the North American market.

A new report indicates that BAIC Motor Corp, Daimler’s primary Chinese joint-venture partner, wants to increase its stake in the company. Currently, BAIC owns 5 percent of the German automaker ( purchased in July) with rumors swirling in October that the firm wanted to increase its investment. There were also claims that Geely was attempting to stand in the way of the prospective deal.

While not Daimler’s main squeeze in Asia from a production perspective, Geely actually owns 9.7 percent of the company — giving it quite a bit of leverage. As such, there were murmurings that Geely put the kibosh on any ideas BAIC had on investing further. Geely has rebuffed the accusation. “We are a long-term investor in Daimler. We do not react spontaneously to any volatility and we support Daimler’s management and their strategy,” the firm explained.

Be that as it may, there appears to be a minor power struggle between the two Chinese companies. Both seem interested in strengthening their influence and happen to find themselves in each other’s way.

Lexus’ first production electric vehicle carries a name that should spur fond memories of a boxy Mercedes-Benz sedan. Yes, the 300E was a desirable German car. Even today, the E 300e is a compelling electrified midsize alternative to those other sedans on the market.

But we’re not here to talk about Mercedes-Benz, even though it’s hard not to when you name a new vehicle the 300e. In this case, it’s the Lexus UX 300e… and it’s not for you, as Corey would say.

Ford CEO Jim Hackett reportedly confirmed that the new Mustang Mach-E we’ve been talking about all day may need to be manufactured in China. Since this is our third article on the vehicle, we’re immensely sorry and promise to keep this relatively short.

On Monday, Bloomberg quoted Hackett as saying the Mach-E will have to figure out a way around the trade war between the United States and China. “We need to determine whether the tariffs are settled. And it would be great [if they were],” Hackett said following the EV’s launch in Los Angeles. “We have a plan to build there if we have to.”

China’s new vehicle market may not be as hot as it once was, but it’s still big. Very big. And pickup trucks, hungrily gobbled up by fleet operators, are a less volatile segment to do business in.

That’s why Ford’s mulling, for the first time, the idea of building Ford-branded trucks inside the country, rather than just importing them. However, before the automaker signs off on such an effort, China will have to do its part.

Eager to minimize import costs, Tesla has made impressive progress laying down roots in China. The company secured a long-term lease on a 210-acre site near Shanghai in October of 2018. Ground was broken at the start of January, with the $5 billion facility estimated to begin producing cars as early as this November. While all of this effort was aimed at expanding the brand in Asia while minimizing costs, it’s not translating into a cheaper Model 3 for the Asian market.

Tesla, being Tesla, has decided to launch the Model 3 with a starting MSRP of $50,000. According to Bloomberg, that’s only 3 percent less expensive than the versions it had to ship across the ocean. Rather than attempting to build more budget-conscious variants, the automaker decided to offer all vehicles sold in China with Autopilot and additional standard content.

The founder of Faraday Future, Yueting Jia, has filed for bankruptcy and restructuring under Chapter 11 in the United States, according to a statement released by the company. The decision allows Jia (known within the company as “YT”) to address his debts in China, which can be measured billions, so his ownership of FF can be transferred to creditors.

Due to Faraday’s repeatedly broken promises and clandestine way of doing business, we’ve never had an overabundance of faith in the company. While that view hasn’t changed, the corporate statement frames Jia’s U.S. bankruptcy as a positive.

The issue of China’s totalitarian government intimidating American businesses into silence over protests in Hong Kong and human rights violations in China has come to the fore, with three nearly simultaneous incidents. The National Basketball Association didn’t quite censure the Houston Rockets’ general manager Daryl Morey for tweeting “fight for Freedom” and “stand with Hong Kong,” but league commissioner Adam Silver’s attempts to mollify Xi JinPing’s regime, to preserve the NBA’s profitable ventures in China, have been described as craven. E-gaming company Blizzard Activision, which is 4.9-percent owned by the Chinese Tencent company, stripped a tournament champion of his title and winnings and banned him for a year for expressing support for Hong Kong in a post-event broadcast. When the animated South Park comedy show satirized censorship in China, the Chinese government simply erased South Park from the Chinese internet as though it never existed. On that side of the great firewall of China, South Park has become like Nikolai Yezhov.

To their everlasting credit, Matt Stone and Trey Parker, South Park’s creators, unlike the NBA and Blizzard Activision, didn’t kowtow, instead releasing an “apology” that mocked both Chinese government censors and the NBA.

It’s abundantly clear that China will use the threat of punishing American companies by restricting access to the Chinese market in order to exert intimidating influence here in the United States.

What does that have to do with cars?