Topic: GM to import Chinese cars; trickle in 2011 will turn to flood in 2014

[articsteve]

This really takes the cake.    American and Canadian taxpayers  throwing 10s of BILLIONS at GM, possibly leading to the demise of Ford,  only to be the first to open the flood gates to Chinese cars as if they don't already have enough of the world's manufacturing sector. 

I say let the GM monster die NOW.

The dreaded wait for Chinese-made cars to hit America's shores may end in two years.

General Motors is telling U.S. lawmakers that it plans to import cars from China starting in 2011, Automotive News reports citing a planning document circulating in Congress. GM would become the first major automaker to bring Chinese cars to the U.S. It would import 17,335 the first year, tripling that volume to 51,546 in 2014, according to the report, dated last Tuesday.

Most likely candidates would be small vehicles similar to the planned Chevy Spark, a minicar that's going to be made by GM in South Korea where it has its Daewoo subsidiary.

China's auto industry has grown so fast -- sales this year have outpaced those in the U.S. -- that an influx of Chinese cars has long been anticipated. Frankly, as of a couple years ago, lots of observers thought they would be arriving by now.

China's internal demand has been so great, there's been little incentive to export. Plus, China is still a developing market that has lower quality standards than the U.S.

While the U.S. market has fallen apart, GM has continued to see some of its greatest success in China. Yet the disclosure could prove pricklish for GM. The automaker is operating on billions of dollars in government loans, and is seeking more. The government's interest is in saving U.S. jobs, both at the automaker and its suppliers. Importing cars from China doesn't exactly further that interest.

Chrysler had talked about becoming the first importer of Chinese cars a couple of years ago, but they would have gone to Mexico and other developing countries.  The deal fell apart.

http://content.usatoday.com/communities/openroad/post/2009/05/66670925/1

[Mitlov]

For anyone who says "OMG NOT CHINA!!!!!!!!!111" here's a couple things to remember:

(1)  Buick China rivals Opel as GM's best design studio, and
(2)  If Chinese manufacture is good enough for BMW, why not GM?  Motorcycle.com: 2009 BMW G650GS

American and Canadian taxpayers  throwing 10s of BILLIONS at GM, possibly leading to the demise of Ford,  only to be the first to open the flood gates to Chinese cars as if they don't already have enough of the world's manufacturing sector.

A Canadian grousing about GM not keeping jobs "at home"?  As Alanis Morissette (who, unlike GM, is actually Canadian) would say, isn't it ironic...

[articsteve]

For anyone who says "OMG NOT CHINA!!!!!!!!!111" here's a couple things to remember:

(1)  Buick China rivals Opel as GM's best design studio, and
(2)  If Chinese manufacture is good enough for BMW, why not GM?  Motorcycle.com: 2009 BMW G650GS

American and Canadian taxpayers  throwing 10s of BILLIONS at GM, possibly leading to the demise of Ford,  only to be the first to open the flood gates to Chinese cars as if they don't already have enough of the world's manufacturing sector.

A Canadian grousing about GM not keeping jobs "at home"?  As Alanis Morissette (who, unlike GM, is actually Canadian) would say, isn't it ironic...

(2)  If Chinese manufacture is good enough for BMW, why not GM?  Motorcycle.com: 2009 BMW G650GS

An engine, and a copy of a ROTAX to boot, which was last made in Bulgaria or Romania.   


Though now built in China, BMW tells us we can rest assured that the 650 Single meets the high standards that all BMW engines must meet.

The Xcountry was the first model to have its engine built in China, so naturally the G650GS would follow. BMW assures us that engine construction meets the same strict standards that all Beemers must meet, but the China connection is obviously a cost saving initiative, with labor in particular. No surprise, right? Were the engine built in Germany, or some other European nation, it would be hard for BMW to keep the G650GS as a price-conscious model. It’s worth noting that the remainder of the bike’s construction continues in Germany.

There were a lot of questions volleyed at BMW staff during the tech briefing over this move to Chinese outsourcing, but I say, “Big deal.” Have your opinions on the labor issue, but in terms of quality I’m not going to be worried one iota until the cylinder walls start melting like green tea ice cream. After all, the engine is a carbon-copy of the former 650 that was sourced from Rotax.

A Canadian grousing about GM not keeping jobs "at home"?  As Alanis Morissette (who, unlike GM, is actually Canadian) would say, isn't it ironic...

Unlike GM, Morissette doesn't feed at the public trough.

[Mitlov]

If the concern is keeping jobs in countries which have given GM bailouts, why isn't anyone screaming bloody murder about GM selling cars in North America that were manufactured in Belgium (Astra) or Sweden (9-3)?  Why is China more offensive than those countries?  Furthermore, isn't the purpose of the bailout to help GM turn around and become profitable, not to just subsidize North American jobs WPA/PWA-style?  If the goal is to help GM become profitable, why subsidize a bad business decision (not exploring the idea of overseas manufacture) for the short-term goal of keeping certain jobs at certain North American factories?

If the concern is quality of design ("the G650GS uses a Rotax design, even if it's not made by Rotax"), I'm not sure what the panic is.  Name me a Chinese Buick design that isn't based primarily on a GM design from elsewhere.  Buick Excelle?  A modified Daewoo.  Buick HRV?  Another Daewoo.  Buick Royaum?  A modified Commodore.  Buick Regal?  A rebadged Opel Insignia.  Buick Park Avenue?  Holden Statesman.  Et cetera.  The article even mentions that the most likely Chinese-built car would be "similar" to the Chevy Spark, a Daewoo design.  Doesn't sound to me like a design created from the ground up in China.

If the concern is quality of manufacture ("the G650GS just has a Chinese-made engine; the rest is assembled in Germany")...geez, what component is more fundamental to a motorcycle than the ENGINE?  It's not like we're just talking about a headlight assembly or an exhaust system here.

[Mitlov]

By the way, let's keep this "trickle" and "flood" in proportion.  GM sold 800,000 vehicles in the US in 2008.  17,000 vehicles would mean 2%, or one in fifty GM vehicles sold in the States.  If the prediction for 2014 is correct, that's up to a staggering 6%. 

For the link Nazis:
http://www.nytimes.com/2009/01/22/business/22auto.html?_r=3&ref=business

[Thinking Out Loud]

If the concern is keeping jobs in countries which have given GM bailouts, why isn't anyone screaming bloody murder about GM selling cars in North America that were manufactured in Belgium (Astra) or Sweden (9-3)?  Why is China more offensive than those countries?  Furthermore, isn't the purpose of the bailout to help GM turn around and become profitable, not to just subsidize North American jobs WPA/PWA-style?  If the goal is to help GM become profitable, why subsidize a bad business decision (not exploring the idea of overseas manufacture) for the short-term goal of keeping certain jobs at certain North American factories?

Both Saturn and and Saab are non-entitites for GM going forward, post refinancing....and even then, their sales numbers didn't likely cost 1,000s of jobs relative to Chevy (Saturn) and Cadillac (Saab) as 'competing' against locally manufactured/assembled product vs an offshore product. 

As to being profitable, yes, but the entire spin to sell investing (?) tax dollars into these companies is to reduce the likelihood of billyuns and billyuns of auto assembly and parts jobs being lost....

I'm with you as well on the 'flood' comment - would those numbers be too far off what Saturn and Saab sold in foreign assembled vehicles?  If so, it'd all come out in a wash....

[toolatecrew]

If the concern is keeping jobs in countries which have given GM bailouts, why isn't anyone screaming bloody murder about GM selling cars in North America that were manufactured in Belgium (Astra) or Sweden (9-3)? 

Saturn and Sabb are both being axed from GM. At least with those examples the billions in $ won't be going towards those vehicles. Those divisions are being eliminated as part of the plan put forward to get these billions.

[gta_driver]

GM already imports chinese made engines for the Pontiac Torrent and Chevy Equinox.

Most of the wiring and wiring harness for the Cobalt, HHR, G5, etc is sourced from China.

The logical next step is to import cars from China.

While the domestic 3 has been shuttering plants in North America, they've been investing in manufacturing in places like China and India.

[Mitlov]

As to being profitable, yes, but the entire spin to sell investing (?) tax dollars into these companies is to reduce the likelihood of billyuns and billyuns of auto assembly and parts jobs being lost....

If the issue is maintaining North American jobs:

GM goes under: 100% of jobs lost.
GM follows this plan:  2-6% of jobs lost.

Which would be better for US and Canadian workers?

[Mitlov]

If the concern is keeping jobs in countries which have given GM bailouts, why isn't anyone screaming bloody murder about GM selling cars in North America that were manufactured in Belgium (Astra) or Sweden (9-3)? 

Saturn and Sabb are both being axed from GM. At least with those examples the billions in $ won't be going towards those vehicles. Those divisions are being eliminated as part of the plan put forward to get these billions.

Okay, fair enough.  How about the Korean-made Chevy Aveo?  The Chinese-made city car they're talking about is going to replace a car that wasn't made in North America to begin with.

And as for the sales numbers, according to this, 50,000 Aveos were sold in 2007.  So we're not increasing the number of foreign-made GMs being sold in North America; we're just moving subcompact production from Korea to China.

http://forums.motortrend.com/70/6344622/the-general-forum/the-real-sales-figures-for-2007-minus-fleetreveale/index.html

[toolatecrew]

As to being profitable, yes, but the entire spin to sell investing (?) tax dollars into these companies is to reduce the likelihood of billyuns and billyuns of auto assembly and parts jobs being lost....

If the issue is maintaining North American jobs:

GM goes under: 100% of jobs lost.
GM follows this plan:  2-6% of jobs lost.

Which would be better for US and Canadian workers?

Just curious where do you come up with a figure of 2-6%?

General Motors Corp.'s plan to slash another 21,000 jobs signals a bumpy road ahead for the global economy as the beleaguered automaker and other companies continue their struggle to cut costs as consumers keep their wallets snapped shut.

To my knowledge GM alone is planning on more planbt closurers,1000s of dealer closurers and the elimiantion of Pontiac,Saab and Saturn. It would seem to me that these already announced cuts amount to more than a 2-6% job loss?

One might say well even 60% is better than 100% job loss but its not necisarrily accurate. Its about the greater good. Saving 10% of jobs SOUNDS better than losing them all but what if it costs 5Billion to save those 10% is that better than taking that 5B and spending it elsewhere?

[Thinking Out Loud]

As to being profitable, yes, but the entire spin to sell investing (?) tax dollars into these companies is to reduce the likelihood of billyuns and billyuns of auto assembly and parts jobs being lost....

If the issue is maintaining North American jobs:

GM goes under: 100% of jobs lost.
GM follows this plan:  2-6% of jobs lost.

Which would be better for US and Canadian workers?

Profitable with N/A operations vs profitable as an importer of vehicles manufactured in China, Mexico and India?

What starts out a a trickle.....Canada is/was less expensive than the US, and then Canada became more expensive than Mexico, which in turn will eventually become 'expensive' relative to China, and China relative to India....

Shoes, bikes, TV's, appliances....why would cars be any different?

Capping build cost to increase profitability will eventually mean that these jobs must move out of North America at some point - if GM stays focused on profitability.  

Personally, if I were an African businessman (in a semi-stable country), I'd be looking BIG TIME into getting into line on this.

It's going THERE eventually!  

[DockMan]

For the link Nazis:

 

[Mitlov]

As to being profitable, yes, but the entire spin to sell investing (?) tax dollars into these companies is to reduce the likelihood of billyuns and billyuns of auto assembly and parts jobs being lost....

If the issue is maintaining North American jobs:

GM goes under: 100% of jobs lost.
GM follows this plan:  2-6% of jobs lost.

Which would be better for US and Canadian workers?

Just curious where do you come up with a figure of 2-6%?

General Motors Corp.'s plan to slash another 21,000 jobs signals a bumpy road ahead for the global economy as the beleaguered automaker and other companies continue their struggle to cut costs as consumers keep their wallets snapped shut.

To my knowledge GM alone is planning on more planbt closurers,1000s of dealer closurers and the elimiantion of Pontiac,Saab and Saturn. It would seem to me that these already announced cuts amount to more than a 2-6% job loss?

One might say well even 60% is better than 100% job loss but its not necisarrily accurate. Its about the greater good. Saving 10% of jobs SOUNDS better than losing them all but what if it costs 5Billion to save those 10% is that better than taking that 5B and spending it elsewhere?

See Reply #4:  if USA Today's numbers are right, 2-6% of GM cars sold here would be made in China.  I'm not talking about jobs lost overall at GM; I mean production jobs lost specifically because of these Chinese-made GMs.  And I don't see why that number would be higher than 2-6%.

But that reasoning assumed that the Chinese-made cars were replacing US- or Canadian-made cars.  It later dawned on me that the cars they'd be replacing are already made in Korea, so selling Chinese cars here wouldn't, in and of itself, result in ANY new job losses.  It'd result in job losses in Korea, but not here.

So in other words, despite USA Today's best efforts to scare me about the "dreaded" Chinese cars, I'm not inclined to panic

[toolatecrew]

As to being profitable, yes, but the entire spin to sell investing (?) tax dollars into these companies is to reduce the likelihood of billyuns and billyuns of auto assembly and parts jobs being lost....

If the issue is maintaining North American jobs:

GM goes under: 100% of jobs lost.
GM follows this plan:  2-6% of jobs lost.

Which would be better for US and Canadian workers?

Just curious where do you come up with a figure of 2-6%?

General Motors Corp.'s plan to slash another 21,000 jobs signals a bumpy road ahead for the global economy as the beleaguered automaker and other companies continue their struggle to cut costs as consumers keep their wallets snapped shut.

To my knowledge GM alone is planning on more planbt closurers,1000s of dealer closurers and the elimiantion of Pontiac,Saab and Saturn. It would seem to me that these already announced cuts amount to more than a 2-6% job loss?

One might say well even 60% is better than 100% job loss but its not necisarrily accurate. Its about the greater good. Saving 10% of jobs SOUNDS better than losing them all but what if it costs 5Billion to save those 10% is that better than taking that 5B and spending it elsewhere?

See Reply #4:  if USA Today's numbers are right, 2-6% of GM cars sold here would be made in China.  I'm not talking about jobs lost overall at GM; I mean production jobs lost specifically because of these Chinese-made GMs.  And I don't see why that number would be higher than 2-6%.

But that reasoning assumed that the Chinese-made cars were replacing US- or Canadian-made cars.  It later dawned on me that the cars they'd be replacing are already made in Korea, so selling Chinese cars here wouldn't, in and of itself, result in ANY new job losses.  It'd result in job losses in Korea, but not here.

So in other words, despite USA Today's best efforts to scare me about the "dreaded" Chinese cars, I'm not inclined to panic

I guess I was confused by the reference to GMs "plan"

If you assume that importing Chinese cars will only result in a 2-6% job loss why would you make the assumption that NOT Importing Chinese cars would result in 100% job loss? Doesn't make any sense.

The act of not importing a small number of cars (as you say) isn't going to cause GM to go out of business is it?

You compared lost jobs from impporting Chinese cars to GM going under? It doesn't seem like an either or to me.

[Mitlov]

If GM doesn't become profitable again, it will eventually go under, because federal aid will not continue forever.

Is the difference between a profitable subcompact and an unprofitable subcompact enough to tip the balance between profitability and unprofitability?  I don't know, it might, depending on what happens with other things that are also important to GM.  There's quite a few things that need to happen in order for GM to become profitable again, and selling a profitable subcompact is one of them.

It's probably more accurate to ask this:  Would the short-term gain of 2-6% more North American manufacturing jobs (by moving subcompact production from East Asia to North America) outweigh the increased chances of GM's long-term collapse (because they're now losing money on every subcompact they sell)?  Not in my book.

[Cortina]

LOL. First they arrive by jet for the dole checks to save the company, that is lossing a small countries fortune everyday and now this. I would love to hear Barrie's take. Funny how he fails to say anything on a topic that he so well versed in. Soon GM will be all Imports.......LOL....

I wish I could get the Government to give me money every time I screw up my business. Let them fall I say. Canada should build its own car. we have all the infrastructure here why not. 

Will the real Domestic please stand up........

[toolatecrew]

I will agree with Mitlov that 51,000 cars from GM would not be a flood. If that is the implication then I agree the title is overlydramatic.

BUT if we are talking the announcment that GM will be the first starting this year and that by 2014 many manufacturers will be doing the same thing..well that's a different story.

Here is a nother article with a little more detail. It does make a good point that the UAW might not make much of a stink as its only less than 2% of GM sales..BUT 2% soundsl like a lot bigger number when compared to production in CANDA now doesn't it. Canada is throwing bllions at GM. But they are going to import from China instead? Its not just subcompacts

Automotive News suggests the China-made vehicles will be small cars similar to the upcoming Chevrolet Spark, but we wouldn’t completely rule out the possibility of a compact sedan for Buick. China is Buick’s largest market and an inside source has revealed GM is planning a smaller, Delta-based sedan for its U.S. Buick division. GM’s expected sales figures would also seem to fall in line with an entry-level Buick sedan.

http://www.leftlanenews.com/gm-to-import-china-made-vehicles-by-2011.html

If making GM profitable requires shifting production to China that's all well and good but what's the incentive for Canada to subsidize a company so they can survive long enough to close Canadian plants so they can import cars from China.

I have no problem wiht importing cars. But if that's their plan let them pay their own way.

[articsteve]

I have no problem wiht importing cars. But if that's their plan let them pay their own way.

 

This is the only issue.  Should Canadian taxpayers dump 4 BILLION, money that will never be repaid, into a company that appears to have no moral obligations to anyone/anything, and whose business plan mirrors that of Walmart.

Eventually GM's contribution to Canada will be limited to increased traffic at the Vancouver docks.

I believe the last pickup rolls out of Oshawa today.

Closure of the plant means GM will no longer produce trucks in Canada and will be reduced to one auto plant in Oshawa and a share of a joint-venture plant in Ingersoll, Ont.

Tuesday's news comes just weeks after the closure of a GM transmission plant in Windsor, Ont., which affected 1,400 workers.

[airbalancer]

Eventually GM's contribution to Canada will be limited to increased traffic at the Vancouver docks.

What !
 Now you have something about Western dock workers having a job