{"id":3418,"date":"2018-04-03T10:46:22","date_gmt":"2018-04-03T02:46:22","guid":{"rendered":"http:\/\/blog.rchss.sinica.edu.tw\/wwchu\/?p=3418"},"modified":"2018-04-03T10:46:22","modified_gmt":"2018-04-03T02:46:22","slug":"courtship-begins-for-chinese-brands-autonews-com","status":"publish","type":"post","link":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/?p=3418","title":{"rendered":"Courtship begins for Chinese brands — Autonews.com"},"content":{"rendered":"

April 2, 2018 @ 12:01 am<\/span><\/p>\n

Laurence Iliff\u00a0<\/span><\/p>\n

http:\/\/www.autonews.com\/article\/20180402\/RETAIL07\/180409935\/courtship-begins-for-chinese-brands?cciid=email-autonews-weekly<\/span><\/a><\/p>\n

\u00a0LAS VEGAS \u2014 After decades of investment by global automakers in the Chinese auto industry, those homegrown brands are branching out on their own, and the race is on for the ultimate badge of success: entry into the U.S.<\/span><\/span><\/p>\n

\u00a0At the head of the line, GAC Motor, a state-owned company with global ambitions, is recruiting dealers to sell its GS8 midsize crossover in limited markets next year. And those dealers, for their part, are clamoring for the chance to get in on the ground floor of the next big thing.<\/span><\/span><\/p>\n

\u00a0Indeed, last month at the NADA Show here, it was often the dealers who were pitching themselves to Guangzhou Automobile Group, and not the other way around.<\/span><\/span><\/p>\n

\u00a0“We came here just for this car,” said Gordon Hunter about GAC’s GS8. Photo credit: JOE WILSSENS<\/span><\/span><\/p>\n

“We came from Sarasota, Florida, to be here,” said Gordon Hunter, general sales manager of Suncoast Motorsports, which sells Volkswagen and Porsche vehicles. “We came here just for this car.”<\/span><\/p>\n

\u00a0The GS8, which also made an appearance in January at the Detroit auto show, was parked at the GAC booth, tucked into a corner of the NADA expo hall, next to a Chinese restaurant. The vehicle is sold under the Trumpchi brand in China but will have another name in the U.S.<\/span><\/span><\/p>\n

\u00a0Hunter had seen it before and was intrigued by the prospect of a startup auto brand in the U.S., and the chance to be part of it.<\/span><\/span><\/p>\n

\u00a0“This might be the next Hyundai,” he said, after participating in a dealer gathering with GAC officials that was closed to the media. “They laid out a timeline last night that was pretty aggressive.”<\/span><\/span><\/p>\n

\u00a0Economic case<\/span><\/span><\/p>\n

\u00a0Perhaps it was only a matter of time before Chinese auto brands worked up the confidence and the product strength to follow the Germans, Japanese and Koreans into the U.S., especially as the competition intensified in their home market. At the same time, auto analysts have been skeptical of the economic case. The U.S. already has quality brands at a variety of prices. And the Chinese companies would have to use a sales model similar to everyone else’s, given franchise laws.<\/span><\/span><\/p>\n

So, what is GAC’s unique selling point?<\/span><\/span><\/p>\n

“I don’t really feel like they have one,” said Jessica Caldwell, executive director of industry analysis at Edmunds. GAC is working on a long-range electric crossover but will face stiff competition by the time it goes on sale, she said.<\/span><\/span><\/p>\n

“But I think for somebody like GAC that wants to be a global player and not just a big player in China, the place, of course, to check off the box is the United States,” Caldwell said.<\/span><\/span><\/p>\n

Colleen Robar, a public relations consultant working with GAC, said the NADA event was a first step in forming a relationship between the Chinese automaker and potential retailers. GAC has opened a research center in Silicon Valley and plans to open offices this year in Detroit and Los Angeles.<\/span><\/span><\/p>\n

Made in China<\/span><\/span><\/p>\n

Consumer sentiment toward Chinese vehicles is unlikely to be a major negative for the new brands, Caldwell said, given that U.S. stores are packed with goods made in China by global brands and by Chinese ones such as Lenovo and Haier.<\/span><\/span><\/p>\n

China-made cars are already sold in limited numbers in the U.S. by brands such as Buick and Volvo, whose parent company is Chinese automaker Zhejiang Geely Holding Group. Ford has also said it will import some cars from China, including the next-generation Focus compact.<\/span><\/span><\/p>\n

For GAC and other Chinese companies, the biggest obstacle may be frosty U.S. trade relations with China, or the risk of a full-blown trade war, especially if the Trump administration decides to apply broader tariffs against China-made products, analysts said.<\/span><\/span><\/p>\n

Duke Hale, a former U.S. auto executive who started Haah Automotive Holdings to distribute Chinese vehicles in the U.S., said he thinks President Donald Trump will ultimately soften his position on China as he has in other disputes.<\/span><\/span><\/p>\n

“We think a lot of it is Trump has a certain negotiating style,” said Hale, who was recruiting dealers for a handful of Chinese automakers that wish to remain anonymous. “He talks big and tends to negotiate down.”<\/span><\/span><\/p>\n

Nuts and bolts<\/span><\/span><\/p>\n

Dealers at the GAC meeting in Las Vegas said the company signaled that it is moving along with the nuts and bolts of certifying the GS8 with the U.S. Department of Transportation, the EPA and other agencies.<\/span><\/span><\/p>\n

GAC Motor President Yu Jun said the NADA Show surpassed expectations: “We have met hundreds of U.S. dealers who have expressed genuine interest in working with us.” Photo credit: JOE WILSSENS<\/span><\/span><\/span><\/p>\n

GAC officials weren’t talking to the media at NADA, but GAC Motor President Yu Jun said the show had surpassed expectations.<\/span><\/p>\n

“We have met hundreds of U.S. dealers who have expressed genuine interest in working with us as we launch GAC Motor in the fourth quarter of 2019,” he said in a statement.<\/span><\/span><\/p>\n

Dealers who attended the event said many details must be worked out on how the brand would operate in the U.S., what facility standards would have to be met and how often vehicles would be added to the lineup.<\/span><\/span><\/p>\n

In its handouts to prospective U.S. dealers, GAC trumpets its top quality rating on J.D. Power Asia Pacific’s 2017 China Initial Quality Study. The brand isn’t among the top producers by volume in China but is growing and sold just more than a half-million vehicles last year.<\/span><\/span><\/p>\n

GAC sells vehicles in 14 countries outside China, though they tend to be relatively small markets: the Middle East, the Philippines, Nigeria, Paraguay and Bolivia.<\/span><\/span><\/p>\n

Rival Chinese automaker JAC Motors is building an auto plant in Brazil after capturing a significant chunk of the local market. JAC also has a joint venture in Mexico.<\/span><\/p>\n

Three-ring binder<\/span><\/span><\/p>\n

Dealers such as Hunter who are confident in the GAC brand are eager to know how the franchise model would work and how best to make their case to acquire one.<\/span><\/span><\/p>\n

Hunter said he told GAC representatives that the company doesn’t need to start early sales in import-friendly California to succeed, as it has suggested. Florida customers would also embrace well-made Chinese vehicles.<\/span><\/span><\/p>\n

“We would like to be chosen as a multipoint dealer,” he said. With just one model to start, Hunter said, he could open a used-car lot around the GS8 and expand as more models are imported. GAC also has a compact crossover, the GS4, in the sweet spot for U.S. buyers.<\/span><\/span><\/p>\n

Another U.S. dealer making a pitch to GAC executives was Roger Burdick of Driver’s Village, a multibrand group in Cicero, N.Y.<\/span><\/span><\/p>\n

Burdick presented a three-ring binder to Fu Jinhai, GAC’s assistant general manager, during a sit-down discussion at the automaker’s NADA booth, which drew strong traffic despite its out-of-the way location. In the binder were photos of Burdick’s dealerships and other data to make the case that he would be a good candidate for GAC’s U.S. launch.<\/span><\/span><\/p>\n

Another dealer and his wife from a multibrand group in the southern U.S. said they were kicking the tires and figuring out how they might incorporate a one-model brand into their stores.<\/span><\/span><\/p>\n

The couple, who didn’t want to be named, said selling the GS8 could be tempting if they didn’t have to build a separate facility. Whether any of their brands would embrace a Chinese company was an open question, they admitted.<\/span><\/span><\/p>\n

You can reach Laurence Iliff at liliff@crain.com<\/span><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

April 2, 2018 @ 12:01 am Laurence Iliff\u00a0 http:\/\/www.autonews.com\/article\/20180402\/RETAIL07\/180409935\/courtship-begins-for-chinese-brands?cciid=email-autonews-weekly \u00a0LAS VEGAS \u2014 After decades of investment by global automakers in the Chinese auto industry, those homegrown brands are branching out on their own, and the race is on for the ultimate badge of success: entry into the U.S.<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8,15,7],"tags":[],"class_list":["post-3418","post","type-post","status-publish","format-standard","hentry","category-china-industry","category-china-enterprise","category-international-economics"],"_links":{"self":[{"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=\/wp\/v2\/posts\/3418","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=3418"}],"version-history":[{"count":2,"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=\/wp\/v2\/posts\/3418\/revisions"}],"predecessor-version":[{"id":3420,"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=\/wp\/v2\/posts\/3418\/revisions\/3420"}],"wp:attachment":[{"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=3418"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=3418"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.rchss.sinica.edu.tw\/wwchu\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=3418"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}