First it was the Ja­panese, then the South Kore­ans. Now the Chi­nese are pre­par­ing an on­slaught of bud­get cars with wide ap­peal, writes NEIL McDON­ALD

Herald Sun - Motoring - - Special Report -

TO SOME it is be­com­ing the China syn­drome, to oth­ers the emerg­ing eco­nomic strength of this com­mu­nist pow­er­house is an op­por­tu­nity.

With China ex­pand­ing at a phe­nom­e­nal rate on the back of in­creas­ing cap­i­tal­ist-style ven­tures and greater mar­ket free­dom, de­mand for its goods and ser­vices is grow­ing in for­eign mar­kets.

First it was tele­vi­sions, mo­tor­bikes, com­put­ers and mo­bile phones.

Now mo­tor­cy­cles have made way for cars.

Chi­nese car­mak­ers are ex­pe­ri­enc­ing un­prece­dented de­mand in their home mar­ket as Chair­man Mao’s orig­i­nal peas­ant work­ers be­come more af­flu­ent and con­sumer con­scious.

But they are also think­ing glob­ally — and Aus­tralia is on their radar.

The an­nounce­ment last week that Syd­ney-based Ateco Au­to­mo­tive will dis­trib­ute Chi­nese-built Ch­ery cars in 12 months will send shivers through some other mar­ginal play­ers in our mar­ket, par­tic­u­larly Pro­ton, SsangYong and re­cently launched Mahin­dra, which are strug­gling to build a beach­head here.

Adding to their con­cerns, and those of other small play­ers, is that Ateco has said the three-model Ch­ery range will prob­a­bly un­der­cut the South Kore­ans on price and equip­ment.

Ch­ery al­ready sells its ve­hi­cles in more than 25 coun­tries, in­clud­ing Rus­sia and Iran, where it also has man­u­fac­tur­ing plants.

The next big mar­ket it is tar­get­ing is lu­cra­tive North Amer­ica, which it hopes to en­ter soon with a range of small cars built in co­op­er­a­tion with Chrysler.

Last year, Ch­ery, one of China’s largest car­mak­ers, sold 381,000 ve­hi­cles.

Its bur­geon­ing ex­port busi­ness would make lo­cal Holden and Toy­ota ex­ec­u­tives green with envy.

Ex­ports have more than dou­bled, from 51,600 in 2006 to 119,800 last year, and such growth is ex­pected to con­tinue.

Aus­tralian im­porters and dis­trib­u­tors are not the only ones wor­ried by Ch­ery.

For­mer Ford Aus­tralia chief Tom Gor­man ac­knowl­edged that China was an awak­en­ing gi­ant.

Be­fore he left the com­pany this year, he said China would have its hands full ser­vic­ing its own mar­ket be­fore ven­tur­ing on to the world stage.

But that has not stopped Ch­ery, and Shuanghuan, Geely, Land­Wind and Bril­liance, from ex­hibit­ing at the Frank­furt mo­tor show in pre­vi­ous years.

Ch­ery has also tar­geted smaller mar­kets such as Pak­istan, Nige­ria and Uruguay.

By Gor­man’s reck­on­ing, it will be five years or more be­fore Chi­nese-built ve­hi­cles are on a par with those from the West.

As one se­nior au­to­mo­tive an­a­lyst pointed out, it took Ja­pan 20 years to have its cars ac­cepted in the West and South Korea about 10.

‘‘But China should be able to crack West­ern re­spectabil­ity in less than five years,’’ the an­a­lyst said.

To help achieve this rapid-fire re­spectabil­ity, Ch­ery hauled in Ital­ian styling house Pin­in­fa­rina to de­sign some of the stylish con­cept cars shown at re­cent mo­tor shows.

Pin­in­fa­rina did the Ch­ery M14 con­vert­ible for the 2005 Shang­hai show, the com­pany’s first homemade coupe with dis­tinctly Euro­pean over­tones.

The car had a re­tractable hard­top, so­phis­ti­cated driv­e­train and a project price of about $21,000.

Then, at last year’s Shang­hai show, Ch­ery showed how much it had learned about de­sign by dis­play­ing the A6 coupe, which is sched­uled for pro­duc­tion this year.

The stylish front-wheel-drive two-door will have a choice of four­cylin­der or 2.4-litre and 3.0-litre V6 en­gines mated to a six-speed man­ual or four-speed au­to­matic.

The Ch­ery A3 hatch and sedan, which look like a cross be­tween an Alfa Romeo and Volk­swa­gen Golf, have gar­nered favourable re­views, based on styling alone.

In an in­ter­view with the US-based Car Body De­sign group at last year’s Shang­hai show, An­drea Pin­in­fa­rina said that when de­sign­ing a ve­hi­cle for a Chine styling hou approach it u

He also b five years gained a pro and North A

‘‘First, th prod­ucts wit safety regul Pin­in­fa­rina s

‘‘Also, a Ja­panese m time to build a highly deve Europe.’’

Ch­ery ma some ac­cep hi­cles must

ese client, the Ital­ian se adopted the same used for other car­mak­ers. be­lieved it would take

be­fore Chi­nese cars oper foot­ing in Europe Amer­ica. hey must align

their th the strict qual­ity and la­tions of the West,’’ said. s in the case of the man­u­fac­tur­ers, it takes d strong brands for such eloped mar­ket as that in ay well be de­sign­ing ta­ble cars, but its ve­meet strin­gent for­eign stan­dards for emis­sions and safety. It has also en­coun­tered some flak for its copy­cat cars and with mod­els such as the A3 and A6, one won­ders how Audi feels about the Chi­nese car­maker bor­row­ing its model names.

Back in Aus­tralia, Ateco al­ready has runs on the board with start-up mar­ques. It pi­o­neered Kia into this coun­try and was be­hind Hyundai and Dae­woo.

It also has ex­ec­u­tive Ric Hull on board, who is some­thing of an ex­pert at launch­ing and build­ing new brands.

Ateco’s hopes for Ch­ery are mod­est in the short term.

It plans a three-model range — a light car, small hatch and a com­pact off-roader.

The A1 mi­cro car will be launched in China this month and with a pro­jected price of about $10,000, it could cause some big rip­ples if Ateco brings it here.

The Ital­ian-de­signed model has a 1.3-litre four-cylin­der en­gine that de­vel­ops 61kW at 6000 revs and 114Nm at 3800 revs.

The 1.3-litre is mated to a fivespeed man­ual.

At 3700mm long, 1578mm wide and 1527mm high, the car is about the same size as the pop­u­lar Toy­ota Yaris.

Ateco may also be able to snare the A3 sedan and hatch or A5.

Other Ch­erys are avail­able too, in­clud­ing a seven-seat peo­ple mover called the V5 and large and medium sedans cu­ri­ously called the Eas­tar and Cowin.

Ch­ery has an an­nual pro­duc­tion ca­pac­ity of 400,000 ve­hi­cles, 400,000 en­gines and 300,000 trans­mis­sions at its Wuhu fac­tory on the Yangtze River.

It is aiming for an an­nual out­put of one mil­lion ve­hi­cles by 2010.

There is no doubt Ch­ery is caus­ing rip­ples in the global au­to­mo­tive scene.

Soon it could be a tsunami.

A5 — $20,000

A1 — SUB-$12,000

A6 — $28,000

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