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Chinese automakers aspire to U.S. sales

Published January 9, 2007


DETROIT - A year ago, a lone Geely Automobile Co. sedan sitting outside the main exhibit halls marked the first time a Chinese automaker displayed at the North American International Auto Show.

This year, Geely was absent from the Detroit show. But another Chinese automaker - Hunan Changfeng Motor Co. - was showing its cars in a more polished display, albeit one in a basement exhibit hall.

Changfeng's Liebao brand cars are being built for the growing Chinese market. But the company is looking for a way to get them on U.S. roads.

Regardless of whether Geely or Changfeng themselves make the jump, the Chinese auto industry represents a tenacious future competitor in America. Roadblocks remain, such as the cost of getting them here and consumer worries about the quality of Chinese cars, but some observers expect Chinese-built cars to be competing for drivers before the end of the decade.

While the U.S. market likely will be important for Chinese carmakers, surviving in their home market may be a shorter-term focus. Foreign automakers are competing aggressively in China, where sales are expanding at double-digit annual rates and major U.S., European and Asian producers have set up factories.

Chinese manufacturers face tough logistical issues in bringing vehicles to the United States, such as establishing dealer and service networks, as well as the cost of bringing them in from afar. Some of those obstacles could be avoided through partnerships with companies that already have a significant share of the U.S. market. And because of that, the first Chinese-made cars for the United States might not be sold under Chinese nameplates.

Last month, DaimlerChrysler AG's Chrysler Group and China's Chery Automobile Co. announced that they agreed on a plan for the Chinese manufacturer to build small cars to be sold worldwide. They will be sold at Chrysler dealerships including those in the United States under the Dodge, Chrysler or Jeep names.

General Motors Corp. and Ford Motor Co. already have significant manufacturing deals with Chinese companies, but they aren't sold in the United States. GM chief executive officer Rick Wagoner said the company has no plans to build a small car in China and import it to the United States, but it could happen.

[Last modified January 9, 2007, 00:27:37]

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