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Monday, 26 April 2010 - China's influence grows in global auto market
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    Read more with google mobile : China's influence grows in global auto market

    Yahoo! My Yahoo! Mail More Yahoo! Services Account Options New User? Sign Up Sign In Help Yahoo! Search web search Home Singapore Asia Pacific World Business Entertainment Sports Technology Singapore Asia Pacific World China's influence grows in global auto market By JOE McDONALD,AP Business Writer - Monday, April 26 Send IM Story Print BEIJING – Nissan's Teana sedan has a full-size back seat, conservative looks and a reasonable price _ just the thing for a Chinese entrepreneur with a family. That Chinese buyer is why the car exists. Nissan says the Teana, though also sold in Japan and other countries, was created with China in mind _ one of a growing number of models designed by global automakers for the world's biggest car market. "The Teana is a Chinese product," said Nissan Motor Co.'s CEO, Carlos Ghosn, at this week's Beijing auto show. "Without any doubt, the Chinese consumer now is becoming a big target for a lot of products that we are developing." China's car buyers have become an important force in the design decisions of automakers from Nissan to General Motors Co. to Volkswagen AG. Their influence is starting to be seen in vehicles sold worldwide. The reason is obvious: China's auto market surged past the United States last year to become No. 1 at a time when sales elsewhere are so weak that major brands make most of their global profit in China. "From volume cars to luxury cars, we can see that all car makers are trying to design cars to fit Chinese tastes," said John Zeng, an analyst for IHS Global Insight. Automakers are modifying luxury cars to suit China's new rich and creating scaled-down sedans and minivans for the populous but lower-income family market. China's growing influence echoes defining periods of expansion in the industry's history _ from Europe to Detroit a century ago and the rise of Japan since the 1970s. GM was a pioneer in designing for the Chinese market. Its Cadillac unit created its 2008 CTS for China, giving it a bigger back seat for Chinese buyers who sit in back while their chauffeur drives. That model was sold worldwide, so Cadillac customers everywhere got the added legroom. Other producers are following. Daimler AG's Mercedes-Benz debuted an extended E-class sedan for China at the Beijing auto show. Ford Motor Co.'s Volvo Cars and Volkswagen AG's Audi have created Chinese models with bigger back seats. Luxury makers are giving cars a longer wheel base and stronger suspension for a smooth ride on China's rougher city streets. China had almost no private cars 15 years ago. But sales have grown so fast since then that the country already is the biggest market for VW, Europe's biggest automaker. It could replace the United States as GM's top market by vehicles sold as early as this year. GM sold 2.1 million cars and trucks in the United States in 2009 and says total China sales of all its brands, including those with local partners, should pass 2 million this year. "The lines are going to cross. It's only a matter of when," said Tim Lee, GM's president for international operations outside North America and Europe. Automakers and industry analysts say Chinese car ownership levels are still so low that sales, from luxury to economy brands, should grow strongly in coming years as millions of families buy their first car. In the mass market, China-inspired cars mix smaller size and lower price with bigger vehicles' more sober styling and focus on interior room. That is aimed at first-time buyers who might be middle-aged with children or a business and care about practical transportation, not sporty looks. Nissan's Teana is priced at 177,000 to 366,000 yuan ($25,900 to $53,600) _ several times China's average annual income of about $3,000 per person but much less than a similar-size car costs abroad. Nissan sold 35,400 Teanas in China from January to March, up 88 percent from the same time last year, according to J.D. Power. GM's compact Sail, designed for China and made with a local partner, Shanghai Automotive Industries Corp., is priced at 57,000 to 69,000 yuan ($8,300 to $10,100). GM's compact Wuling Zhiguang minivan, also made with SAIC, costs 37,000 to 46,000 yuan ($5,400 to $6,700). Chrysler LLC linked up with a Chinese partner, Chery Automobile Co., to turn one of its low-priced models into a compact for the U.S. market but the alliance was called off after the global crisis hit. China's influence extends to products marketed by global automakers in other developing markets. GM and SAIC announced in December they will expand their partnership to India to make and sell Wuling minivans and flatbed trucks. Last year, Wuling became the first brand in China to top 1 million units in annual sales. "We are currently exporting Wuling products to a number of markets in Africa and in South America very successfully," Lee said. "We know we will be successful in India as well." Ford is following a different strategy, using Chinese market research to help design global vehicle platforms rather than creating a China model, said Joe Hindrichs, the company's president for Asia-Pacific and Africa. "What's most important to us is that we have Chinese input from consumer research and Chinese employees into the design process of our products so we get Chinese desires and perspectives," Hindrichs said. "We are doing that on all our global products because we know how important the Chinese market is." At the Beijing auto show, Ford displayed a micro-compact concept car, the Start, with a three-cylinder engine. Its chief designer, J Mays, said Ford had crowded Chinese cities in mind when it created the car. Automakers also are turning to China for design talent. Nissan plans to open a Beijing design center in 2011. It would be the first in China for a Japanese automaker and add to Nissan studios in Japan, Britain and the United States. "We are going to hire a lot of Chinese designers," said Ghosn, the Nissan CEO. GM launched a Shanghai design center with partner SAIC in 1997 that Lee said has grown into a "fully capable engineering center where we can do cars from bumper to bumper and from tires to roof." It designed the interior of the latest Buick LaCrosse sold in the United States and created the new Sail sedan and hatchback. For now, Sails are sold only in China. But, Lee said, "We could easily use those designs and that product in other markets." 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