Motorcars for the masses
BEIJING--At the infamous Silk Alley here, some of the world's most aggressive capitalists block your path and tug at your sleeve until you agree to buy some of their merchandise. It's not much different at the Beijing Auto Show.
In Hall 10 of the convention center--the cheap seats, on the fringe of the action--a dozen of China's second-tier automakers are madly pleading for attention. In the center of the hall, a woman in a black evening dress hangs out the sunroof of a JAC minivan, sawing away at an electric violin. Next to her, a group of dancers dressed like the New England Patriots cheerleaders gyrates to blaring hip-hop amidst several Liebromotor vehicles. In the corner, a model with her own voluble soundtrack touts the virtues of Mobis auto components by tossing flower petals out of a hat. As lovely as the entertainers are, the clamor is so jarring it would make a jihadist jumpy.
Yet the free-for-all in Hall 10 is no more manic than the marketplace itself. There are more than 100 companies building cars in China, and former state-owned enterprises that specialize in pharmaceuticals and cellphone batteries have said hey, what the heck, we think we'll get in the game, too. The Chinese government, however, is putting on the brakes. With the economy roaring and a prosperous middle class bursting forth like a thousand thirsty blossoms, the ministers have declared the auto industry a pillar of the country's modernization. And a "new auto policy," if it's ever enforced, will consolidate the sector into a much smaller number of healthy companies able to build cars good enough--surprise, surprise--to export. Which means much of the activity at the auto show represents a mad dash for the lifeboats.
Look-alikes. One survival strategy on display throughout the show: Take advantage of China's wink-and-nod intellectual property laws to steal as much as possible from successful companies. The logo on a collection of vehicles by a company called BYD looks suspiciously like BMW's blue and white emblem, except that the colors are inverted. An SUV made by ShuangHuan Auto is the spitting image of Honda's CR-V, with half of Audi's well-known logo on the grille: two interlocking circles, instead of four. And the oak-leaf crest that Shanghai Wanfeng Auto chose for its vehicles is borrowed straight from Cadillac--which, in bold American fashion, rented out a former temple near Beijing's Forbidden City last week and put on an Academy Awards-style gala to announce that it will begin selling vehicles in China this fall.
But the most audacious borrower is Chery, an up-and-comer that will sell more than 100,000 cars in China this year. The Chery QQ, a spartan but cute four-door hatchback, is a virtual clone of the Chevrolet Spark--a little mix-up that goes back a few years when both companies apparently obtained the same design plans from Korean automaker Daewoo. And the $6,000 knockoff is a show-stealer, with one model on display wrapped in white fur and filled with stuffed animals--an overture to commuting moms. The QQ is a spoiler in the marketplace, too, undercutting the Spark by about $1,500 and outselling it by nearly 6 to 1. Chevy's parent, General Motors, has berated the government, with no result. Chery, meanwhile, feels emboldened. "In a few years," predicts Michael Zhang, a Chery executive, "maybe our car can enter the U.S. market, and you will find it in your hometown."
The big, sophisticated companies act unimpressed. Alongside the basic, practical cars that they produce in concert with Chinese manufacturers, global automakers like Ford, Toyota, and Chrysler are showing off some of the world's most desirable vehicles. Yet these are automotive delicacies that the thousands of Chinese thronging the sold-out show may never get to sample. Chrysler recently got a government license to import the stylish Crossfire two-seater and the hulking 300C sedan--but only a few hundred of each. Ford is showcasing pace cars like its revitalized Mustang and the opulent Lincoln Navigator--even though the company has no plans to bring them to China. "These are art pieces," says Denton Dance of J. D. Power & Associates, "meant to let people know these companies make great cars." Maybe so, but the spectators here seem more interested in the blue-light specials than museum exhibits.
This story appears in the June 21, 2004 print edition of U.S. News & World Report.
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