A Chinese Volvo: Would You Buy One?
Posted By:Phil LeBeau
Topics:Mergers & Acquisitions | China | Asia | Automobile Industry
Sectors:Automobiles and Parts
Companies:Ford Motor Company
For as long as I've worked the auto beat, I've heard the same thing, "watch out for the Chinese car companies!"
The theory/fear being, Chinese automakers will get to the U.S. market and work quickly to make their mark. For years, many thought the companies would leverage their relatively cheap labor to send us a flood of entry level cars. Turns out the Chinese are more likely to take the highway of established brands.
Reports that Chinese based Chery Autos may be interested in buying Volvo from Ford [F 5.11 0.21 (+4.29%) ]are not surprising given the appetite the Chinese have to establish themselves in foreign markets. And from Chery's perspective, getting Volvo for $3-$5 Billion would be acquiring a brand with a strong identity. That image as a leader in safety and quality would go a long ways towards convincing the world Chery is serious about building and selling stylish, well-made cars.
And don't think the Chinese automakers aren't ready to try stepping out of their home market. When I went to the Beijing Auto Show in April, I heard and saw how "international" these companies have become.
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Many of the engineers and executives building these companies, were trained and cut their teeth at automakers in the U.S., Europe, and Japan. Now they've come home. They are the ones driving the the Chinese automakers to grow quickly and expand. And they know what it takes to win in the U.S.
Which brings up the question: would you buy a Volvo if a Chinese company owned it? Would it make a difference to you? Drop me a note and let me know.
Questions? Comments? BehindTheWheel@cnbc.com
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