Cars and Drivers
China Finally Buys A Western Car Company
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After a year of false starts in which Chinese car and manufacturing interests have tried to buy Hummer and have kicked the tires at Volvo. a mainland firm, Beijing Automotive, will buy most of the assets of Saab.
The Wall Street Journal reports that the transaction will include the intellectual property for two sedans, the 9-3 and 9-5, and some manufacturing facilities. GM is the seller. Chinese state banks will put up the money.
The move is not very impressive. China wants to enter the international car business and move beyond the successful enterprises within its own borders. To carry out that task it is going to have to buy a firm bigger than Hummer or Saab. China may be able to export its own vehicles, but it could take years to create dealer networks in the US and Europe. The fit and finish of Chinese-made cars is not considered up to the standards of most Western buyers.
Fiat may falter in its turnaround of Chrysler and run low on money. That may be China’s only really significant option for picking up immediate market share in the US.
Douglas A. McIntyre
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