DETROIT — Did he just call that new car model the Lobster?
Hundreds of media representatives crowded around two Chinese vehicles at the North American International Auto Show Tuesday, somewhat confused and befuddled about what they were looking at.
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Changfeng Motor Chairman Li Jianxin made an earnest attempt to read a speech in English to the crowd, but parts of the message were lost in translation.
Especially when some folks thought one model was named after an undersea crustacean.
But dismissing Chinese automakers for their limited English skills, and because their vehicles don't seem quite ready for prime time, could be a mistake.
"It is really dangerous to underestimate" Chinese automakers, says Kevin Smith, editorial director for consumer website Edmunds.com. "The idea that it'll take years and years for them to be up to speed — I don't buy it."
Chinese automakers have their sights set on breaking into the U.S. market, and soon.
Importer Chamco Auto says it will bring an SUV and a pickup to the U.S. market by late 2008 or early 2009. Changfeng hopes to enter the market in 2009, and car and battery maker BYD says it could be here in three to five years with a plug-in hybrid that it's introducing in China this year.
There are big hurdles remaining, however, for all the automakers. First, they have to meet all the U.S. regulatory demands, which include installing air bags where needed and meeting fuel-efficiency requirements. And, they need to figure out what U.S. consumers want, which could be a challenge.
Li Shufu, president of Geely, says the automaker thought it was going to make its mark in the USA by offering cheap cars and trucks. But after visiting the auto show last year, the carmaker was advised by a market researcher to change strategies, and it now is emphasizing quality and safety.
Geely doesn't "want to follow everyone else," Li Shufu said through a translator. "We want to find a product that Americans really need."
On Monday, Geely showed a video of a braking system that helps keep cars in control when a tire blows out. Li Shufu says the automaker hopes that technologies such as that prove to Americans that the Chinese can engineer cheap cars that are also safe.
Last year's recalls of Chinese toys and other products could be an obstacle for importers, says Sean Saleen, dealer operations director for ZX Automobile, which plans to import two Chamco vehicles.
"First and foremost, we're going to come to the U.S. with quality," he says. "We're learning from the mistakes other automakers made." Quality and price are top concerns, and they aim to offer a yet-to-be-named pickup and SUV at least 20% cheaper than similarly equipped models from other carmakers.
Geely also is working to avoid quality mistakes. "We are very careful to do everything slow," Li Shufu says. "The quality requirement is very high, so we have to be very clean before we do anything."
Still, critics say the Chinese aren't ready to sell cars in the USA, which is the largest automotive market in the world.
Ken DeWoskin, a consultant at PricewaterhouseCoopers' Detroit office, says the Chinese need at least 10 years of exporting flawless auto parts and supplies before venturing into car exports. They've only been exporting parts for five or six years. "The cars you see at the auto show are not ready for prime time," he says. "The fit and finish on the vehicles they ship to Detroit is way off."
But they could catch up quickly.
"Their ability to move quickly is unlimited," Smith says. "They have huge resources and ambition, and can buy the talent and expertise they need to get up to speed."
Eventually, at least one Chinese automaker would like to take over manufacturing cars for the USA, and let Americans specialize in high-technology manufacturing.
"Americans should go to a new industry of space technology," says Geely's Li Shufu. "The automotive industry is a traditional manufacturing industry. … America should do the easier job and keep the hard job for us."
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