Chinese may not come to US afterall, well.... Not yet.

[enzl]

The US companies that demand low, low prices from their suppliers are every bit as responsible as US consumers who merely want to pay less. These companies go to China, seek lowest bidding wars, dictate pay, quantity, turnaround time, and other impossible conditions, and all that naturally perpetuates the poor quality or downright dangerous goods we read about. Meanwhile prices of goods certainly haven't fallen to match the lowered costs of production - how strange.

These circumstances are very much like what we see here in the Los Angeles garment industry. Blaming the small "factory" owner who struggles to make ends meet is foolish, when those higher up systematically demand sweatshop/slave conditions. Company housing, indentured servitude, and the conditions that go with it - unpaid wages, long hours, dangerous work environments, and cut corners - sadly aren't unique to China.

The reason most Chinese goods are cheap is because they are cheap. Make them properly and soon the cost benefits of "made in China" disappear. Chinese factories can and do assemble the iPhone, probably the nicest cellphone in the world, and it's not exactly inexpensive. My Treo and MacBook are both made in China, and they are perfectly fine; the Volt's battery cells, regardless of who develops - LG (Korea) or A123 (US) - or packs - CPI (US) or Continental (Germany) - them, they will likely be made in China, because that's where the manufacturing base for batteries has moved to.

Hopefully by demanding higher quality goods, companies will decide to move production back to the United States, where as thegriffon noted, we have an efficiency advantage... but I'm not holding my breath.

An even handed account of the reality in China...I agree completely.

As a US company, when I outsource to China, I am responsible for that labor, that product and that quality(morally & legally). To state that China makes cheap crap, and leave it at that, is not reality.

Many high quality items are produced in China. Lots of crap, too. If a company chooses to sell it here, they are exclusively responsible for it. Not the Chinese people as a whole--most of whom would give up a body part to work at a 'Western' factory--simply because they need work! Not because they're trying to unseat the US economy. Odds are these individual Chinese human beings don't know nor care about stuff we have the luxury of choosing to idly debate here.

[Guest aatbloke]

Do many new Chinese models look well-engineered? Well so they should, since the development was done by the same European firms which subcontract for part or all of some western development programs. Chinese firms may have less money to spend, which shows in the results, but what can you do when you have no idea how to do it yourself? Of course Daewoo was also dependent on European engineering and design firms after GM pulled out (to a lesser extent than most Chinese companies though and at least had existing GM platforms to work from), but then you know what happened to them.

All good points. As their economy grows, so will wealth demands of the ordinary worker. They'll also demand better quality in everything, which will also force up prices. Coupled with what they're learning from their western partners, there's going to be a learning curve, and I dare say a pretty fas one at that.

[IfICouldWouldYou?]

All good points. As their economy grows, so will wealth demands of the ordinary worker. They'll also demand better quality in everything, which will also force up prices. Coupled with what they're learning from their western partners, there's going to be a learning curve, and I dare say a pretty fas one at that.

The great fallacy with this is that China has an immense supply of cheap labor. The US has already tried this approach with NAFTA, but look at the results: Mexico is still a horrible mess and the 'refugees' flood across our borders to escape. Raising countries to our standard of living only works with countries that are reasonable. It worked with Japan. It worked with Taiwan, to a large extent. It is failing with Mexico and it will fail with China. Labor prices can only fall if the supply of labor at least stagnates and I don't think we will see that any time soon.

We are seeing such struggles in all the so-called BRIC countries: exploding population growth is overwhelming those country's attempts to raise their standards of living.

I also like the earlier point about carbon taxes being a secret way of excising duties on imported goods. The environmentalists will support Washington on this one, and in an indirect way we will be doing the Asians a service: the level of pollution over there is shocking. Perhaps the BBC should cover that, instead of gushing over the increase in highways.

If every Chinese household were to obtain a refrigerator, we could kiss good bye our ozone layer.

[Guest aatbloke]

The great fallacy with this is that China has an immense supply of cheap labor. The US has already tried this approach with NAFTA, but look at the results: Mexico is still a horrible mess and the 'refugees' flood across our borders to escape. Raising countries to our standard of living only works with countries that are reasonable. It worked with Japan. It worked with Taiwan, to a large extent. It is failing with Mexico and it will fail with China. Labor prices can only fall if the supply of labor at least stagnates and I don't think we will see that any time soon.

We are seeing such struggles in all the so-called BRIC countries: exploding population growth is overwhelming those country's attempts to raise their standards of living.

I also like the earlier point about carbon taxes being a secret way of excising duties on imported goods. The environmentalists will support Washington on this one, and in an indirect way we will be doing the Asians a service: the level of pollution over there is shocking. Perhaps the BBC should cover that, instead of gushing over the increase in highways.

If every Chinese household were to obtain a refrigerator, we could kiss good bye our ozone layer.

With the greatest respect I disagree with you. I don't think that China's incredible economic changes over the past twenty years can be compared with any other country on earth. In the late 1980's, China had a few short kms of freeway, a crumbling infrastructure, and offered no incentive for its people to achieve success. These days, it has the second largest road network in the world, one of the world's most modern infrastructures, and more entrepreneurs than ever before. Top-flight stores such as Gieves & Hawkes and Fortnum & Mason, who traditonally catered to the British aristocracy, now also operate in China. In the motor industry, it is no surprise to find car manufacturers not only wanting to push marques such as BMW, Mercedes-Benz and Cadillac in China, but also manufacture models there too.

China remains a long way from the west in terms of standard of living, but unlike countries such as Mexico, it's unlikely to remain that way with such massive growth. China recently knocked the UK from the position of 4th most powerful economy in the world. Living standards will eventually rise as a result, and the ordinary Chinese will expect more for themselves as they see so much improvement around them.

Edited March 29, 2008 by aatbloke

[PurdueGuy]

I'm surprised no one has asked this yet...

what does this mean for the Dodge Demon?

[IfICouldWouldYou?]

Undoubtedly, China has experienced phenomenal growth in the past decade or two; however, don't be fooled by the glossy tourist photos. At this stage, the growth is concentrated in certain areas, like Beijing. The rural areas are still largely untouched by this 'progress.' It is from these more loosely populated, rural areas that the vast influx of cheap labor is flooding.

Otherwise, why are shipping containers full of 'refugees' still washing up on the western shores of Vancouver Island and Seattle?

We can hold our breath and hope that we can 'westernize' China, but if we fail, the world is in for a clash of civilizations that is going to make the Cold War look like a tea party.

One other factor to throw into the fray: Russia has negative population growth. It is estimated that in 15 years, Russia will not be able to muster the manpower to maintain its own borders with China. Russia = space and resources. China = no space and dwindling resources. Throw that on the plate for the UN to sweat about in 10 or 15 years.

[The O.C.]

I'd rather buy a used Domestic, Japanese, or European car than a new Chinese POS.

LOL....that was the exact same argument many used against the Koreans when they first came here.

Look where they are now.......hmmmm.......

[The O.C.]

I wouldn't hold your breath. The company bringing them in isn't exactly a well-established vehicle distributor. Their "established network" is the one they organized to sell Chinese vehicles which didn't materialize.

Wrong-o......Global is fully-prepared to bring Mahindra into the country. The question is when the Mahindras will be ready.

I've got a friend that is on the management team at Global so I get pretty frequent updates on how things are going. In fact, my friend has been actively involved in signing up dealers.

Global is in no way another "Chamco."

BUT, even my friend acknowledges that Mahindra will most likely only really thrive once Tata buys the U.S. distributor outright......

[Diehard GrandPrix Fan]

I would give them a chance. For example, look at Hyundai's and Kia's. They were just as bad say, 10 years ago and considerred a trash everywhere they go, yet they gradually improved as competition grew more fierce, and when they realized they can't follow along with the craps they had and decided to put more attention to the quality of their products. Thanx to that, their quality have gradually improved and while they still have a way to go to be considerred at a Japanese level, not many people laughs at the ones who bought them. At least, no more. Pretty amazing since about 5 or 10 years ago, Hyundai's were talk show's favorite laughing stock and considerred the WORST ever made.

I would give the Chinese, Indian, and even Malaysian a chance, for it is obvious that they will eventually catch up and before we know it, they will be a threat, not just to the Japanese, but to the big 3 as well. Just look at China's resource, and the labor(one of the most populated nation in the world) so they can produce a LOT at a VERY LOW price and I think they will improve in no time.

[Diehard GrandPrix Fan]

LOL....that was the exact same argument many used against the Koreans when they first came here.

Look where they are now.......hmmmm.......

Well, I still believe Koreans have far more way to go to catch up. They are close, but just aren't there yet to be the equal quality of the Japanese. Just look at their horrible, horrible, resale value. They Suck.

[thegriffon]

Wrong-o......Global is fully-prepared to bring Mahindra into the country. The question is when the Mahindras will be ready.

I've got a friend that is on the management team at Global so I get pretty frequent updates on how things are going. In fact, my friend has been actively involved in signing up dealers.

Global is in no way another "Chamco."

BUT, even my friend acknowledges that Mahindra will most likely only really thrive once Tata buys the U.S. distributor outright......

Mahindra is completely unrelated to TATA, so, he'll be waiting a long time. Signing up dealers is what these companies are good at—delivering vehicles, yeah right.

[thegriffon]

LOL....that was the exact same argument many used against the Koreans when they first came here.

Look where they are now.......hmmmm.......

Uhh..., stagnant growth, still two generations behind in crash worthiness (Kalos, Rio, Accent), still using old engines borrowed from Mitsubishi etc.?

[LosAngeles]

Perhaps it is paranoia on the part of the Communist government, or maybe there is a more insidious reason they insist western companies hand over their technology. China has targeted airline manufacturing and aerospace next. I am all for friendly cooperation, but I have yet to see any from China. I just can't see why we are all in such a hurry to jump into bed with them.

Simple. Western and Japanese companies want the minds of the 1 billion spenders of Chinese MONEY.

By my calculator; japan (toyota) started importing in '57, and after years of not accomodating the U.S. market, 'fell into' the Energy Crisis of '73. Even by '80, that was only 23 years, tho in that no one knew of toyota until the latter half of the '60s; one could legitimately argue that it took toyota merely 15 years to make a major impact ('65-80).

hyundai first imported to the U.S. in '86, so they are right around the same timespan as the japanese WRT vehicles in the U.S. market; by '86 there was little 'anti-asian car' sentiment left- toyota 'paved the way' for hyundai here.

I'd argue that Nissan did more to increase the Japanese car's profile in this market than any of the others. I recall a little vehicle called the Z. 510 and the Bulletside truck were no joke either as far as running up their respect numbers.

An S10 would be bleeding edge (actually a D22 Frontier with the engine from an '89 Quest is state-of-the-art for Chinese pickups, and Dongfeng Nissan keeps that to itself).

LOL, there's no such thing as an '89 Quest (unless it was JDM or something)

Do many new Chinese models look well-engineered? Well so they should, since the development was done by the same European firms which subcontract for part or all of some western development programs. Chinese firms may have less money to spend, which shows in the results, but what can you do when you have no idea how to do it yourself?

It's funny you say that when we all know China can make a mean* knockoff.

*Mean meaning bad of course.

The US companies that demand low, low prices from their suppliers are every bit as responsible as US consumers who merely want to pay less. These companies go to China, seek lowest bidding wars, dictate pay, quantity, turnaround time, and other impossible conditions, and all that naturally perpetuates the poor quality or downright dangerous goods we read about. Meanwhile prices of goods certainly haven't fallen to match the lowered costs of production - how strange.

These circumstances are very much like what we see here in the Los Angeles garment industry. Blaming the small "factory" owner who struggles to make ends meet is foolish, when those higher up systematically demand sweatshop/slave conditions.

Just imagine the money that buys the LRG and Volcom hoodies on the backs of our youth and that it more than likely supports this.

I wanted to say it would be nice if these products were manufactured in Africa or Haiti to help those ugly economies out there, but not if it equals those kind of sweatshop practices. Nice conflict of my political interests.

But man, if the same products were made here in the U.S., you're looking at the same $90 hoodie probably costing $200.

I'm surprised no one has asked this yet...

what does this mean for the Dodge Demon?

You hear that? That's the sound of nobody giving a s--t.--Triumph the Comic Dog.

Well, I still believe Koreans have far more way to go to catch up. They are close, but just aren't there yet to be the equal quality of the Japanese. Just look at their horrible, horrible, resale value. They Suck.

Classic brand perception snobbery. We'd likely feel the same way about Lexus if all those cars came here as Toyotas (even with how Camrys are worshipped at the altar)

[cletus8269]

i love to read the posts of people with the low member numbers and relatively low post numbers... its refreshing because usually, what they say means something instead of just saying something to be heard... actually... i guess i'm... just saying something... to be heard... carry on.

[Guest aatbloke]

Undoubtedly, China has experienced phenomenal growth in the past decade or two; however, don't be fooled by the glossy tourist photos. At this stage, the growth is concentrated in certain areas, like Beijing. The rural areas are still largely untouched by this 'progress.' It is from these more loosely populated, rural areas that the vast influx of cheap labor is flooding.

Otherwise, why are shipping containers full of 'refugees' still washing up on the western shores of Vancouver Island and Seattle?

We can hold our breath and hope that we can 'westernize' China, but if we fail, the world is in for a clash of civilizations that is going to make the Cold War look like a tea party.

One other factor to throw into the fray: Russia has negative population growth. It is estimated that in 15 years, Russia will not be able to muster the manpower to maintain its own borders with China. Russia = space and resources. China = no space and dwindling resources. Throw that on the plate for the UN to sweat about in 10 or 15 years.

I'm not fooled by glossy photos. I'm commenting upon what I've experienced myself.