Where is China?

Rick Haglund at MLive wonders aloud if the Chrysler treatment would be an option if it were a Chinese firm assuming the Fiat position. He’s been talking to pundits working on closer Michigan-China business ties, and they claim that a tie-up with a Chinese firm would be better for Chrysler than the Fiat deal already in progress. “They’re not putting in any cash, which is what Chrysler needs,” argues former AMC Chairman Gerald Meyer. And there’s no doubt that Chinese firms have cash. But, “there’s a xenophobia that’s clearly there,” argues Tom Watkins. And he’s right.

Even though Americans buy Chinese goods by the metric ton, they tend to be less-visible goods with fewer image implications than cars. And though the Chinese and American economies desperately need each other, the respective populations harbor deep suspicions planted by one too many outsourcing stories/embassy bombings/melamine stories/arms sales to Taiwan. Et cetera. If Chrysler dealers don’t like the market now, they should imagine what might happen at a (say) Brilliance/Chrysler dealer when the next human rights scandal/spy plane crash/Taiwan sabre rattling/TienAnMen massacre goes down.

Which is not to say this is a good thing. It would clearly be preferrable for Chrysler to be bought rather than handed off with the taxpayer’s cherry on top. Heck, seeing it end up as part of a firm that has money to invest in it might be exciting too. But why would the Chinese jump into the US? Their market is now bigger than ours, remember? And it’s still growing. Still, the Chinese invasion has seemed so inevitable for so long, it’s a little surprising that (thus far) none of the Chinese firms have made a move. But keep holding your breath, Volvo, Saab, Hummer and Saturn!