Team-BHP - GM-Wuling-SAIC(chinese) cars-their fate and acceptibility in India

As GM India is planning to launch 4-6 vehicles developed by its chinese partner SAIC, my apprehensions rose immediately. We all use a raft of products in our daily lives which are made in china, from mobiles to tvs, pc products and so more. But one thing of major concern IMO is, where the product is developed or where was its R&D. All the branded products we use and are manufactured in China, are actually developed somewhere else, most probably where the company belongs and is manufactured in China because of its cheap labour. But with SAIC-Wuling cars its different. The Sail sedan and hatch which GM plans to launch in India is developed in China by SAIC, with inputs from GM. The whole scenerio brings two questions in my mind
-Brand(for personal buyers)
-Reliablity(for commercial buyers).
So what is your take at the time

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It takes considerable time for 'brand comfort' to emerge [ I coined this term on the fly to denote the degree of acceptance that a potential buyer may feel - based on his /her perception of the manufacturer's capabilities and other, read culture specific issues]; cast your mind back to the 1950s when Japanese toys were objects of derision in the West and fast forward to the early seventies when Japanese cars began their assault on the Big Three by selling in serious quantities in America].

So, I feel that the story will be repeated again, this time for Chinese auto manufacturers and it will take them some time to find acceptance, even in a maturing, not mature market such as India. Brand comfort is dependent on buyers' perceptions and Indians have accepted Japanese, Korean, American and European products.

The same query can be put to potential buyers in China or for that matter other maturing markets ( Russia, Brazil, Indonesia et. al) about Indian auto manufacturers and their ability to establish a bridgehead quickly.

I remember an Indonesian friend telling me a few years ago, that till the turn of the century a Bajaj three-wheeler was a common sight in Jakarta and other cities in Indonesia, but it was left behind by economic progress when middle class Indonesians could afford to buy cars.

I imagine a Nano or an Alto, or even a Swift/ Swift Dzire/ Indian made Polo will struggle initially for want of brand comfort. MNC branding will help. That is where the Tatas will have initial problems, not so with JLR though.

Once the products show up as reliable and perform as per the manufacturers' claims, brand comfort and sales will happen.

Ditto for Chinese cars.

In India, where the first factor is the price, I reckon the Chinese will head for the jugular and offer very reasonable prices. I don't think an expensive priced Chinese product will sell well right now.

Brand comfort?

There you go.:D

Regards, drive safe

If GM were to bring the SAIC models to India they will most probably use their own brands to market it. So the issues linked to Chinese brand may not arise. Afterall how many people out there know that the Chevrolet's running on Indian roads have their origins in Korea or Japan.
When there is a familiar brand it all boils down to the merits of the product and customer service.
On reliability- well to be honest none of us have owned a completely chinese designed car and we are all swayed by our perceptions. To find it in reality we will have to wait.

While I do not expect anything extraordinary from SAIC I would expect them to bring a high value-for-money product to India.

Well in my opinion, if everyone has seen the potential of SIAC, you will not find the difficulty in brand reliablilty. Not all chinese products are worse in quality, we cannot compare the cheap plastic products that we see in platforms with that of high standard products. There are many sectors wherein quality has to be maintained and am glad that automotive is one such sector. And the chevy sail in china was launched in march 2010 (if i am not wrong on the month) and when it comes to India (which is in 2012 - definetely not before that) we have a whole 2 years to look at the reliability of the product, so this should not be an issue henceforth. Considering the brand recognition, people have started accepting chevy as a brand in India, so its 1 long year to go before these vehicles are launched and since these would be released with chevy name plate, thanks to chevy for not confusing people with many brands under one roof as it has in US, people in general would not even know that these are in colaboration with chinese companies. :thumbs up

fx45 - It takes maximum to the limit testing and validation of vehicles to get it released for it to sustain in market with quality and durability, that's why you could see mule test vehicles on road, this will be put to rigorous testing for 2011.

I saw mule vehicle of toyota etios in agra in june 2010, it would have started by 3rd or 4th Q of 2009 itself. So its quite common in automotive sector.

We need to differentiate between 'Cheap Chinese products' and 'All Chinese products are cheap/unreliable'.

The first category is real, the second just a myth.

Majority of products/appliances we use in our daily lives are totally or partially (w.r.t. components) manufactured in China, and not all of it is of poor quality. It's unfair to brand a product unreliable just because it came from China. We also need to realize a lot of 'elite' products are available to the common man today because of the Chinese manufacturing.

Give them a chance. If they can't deliver, the Indian market is ruthless enough to run them into the ground.

On thing that GM wanted was to encash the Chevrolet Brand, which had a huge presense and fan following after failing miserably with Opel due to product issues.

Secondly it is a know fact that Asian designs (Japanese, korean) run a decent production run inspite being awful, European and American designs on the other hand do not come any close.

So GM strategy is clear on rebadging Korean cars as Chevy and encash.

With the Chinese Cars they are stepping up the game by having a cost advantage.

For chinese products more than the actual quality it is the percieved quality that spoils. With the Design and Quality under GM's control I think things will go in right direction.

"It is true that General Motors will introduce a few Chinese vans in the Indian market in 2012. These products will be sourced from the SAIC stable. We have caught the the EECO challenger on test in Vadodra. While that will take care of bringing volumes from the goods transportation sector, here’s a more interesting vehicle that will give the Xylo a run for its money."
GM India will rename this vehicle and perhaps sell it under a new brand. The vehicles will wear the Chevy bowtie however. The branding is still work in progress and it is expected to bombard the market in late 2011 or early 2012. As some parts will be sourced from China, the cost of the vehicle is expected to stay below 7.5 lakh rupees.

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Cheers!

Quote:

Originally Posted by Chetan_Rao (Post 2175426)

there is a lot of difference between "manufactured in china" and "made in china". Dont confuse these 2 even though all the label carries "made in china". The majority of products/appliances are "manufactured" is china. They are designed by other companies and manufactured by the specification provided by these companies and goes through the QC by these companies. Hence even the ipod "manufactured in china" works great. these 'elite' products are manufactured in china not made in true sense. Same cannot be said for china made products-the products designed manufactured in china. Even when many of these are counterfeits or reverse-engineered. If you have bought any of these you wont need much explanations. There are exceptions like network equipment manufacturer huwaei, but these are exceptions rather than norm.
Coming to automobiles it is the same thing. Two of the top chinese auto majors have been trying to enter the US market for many years now. But they cannot because they are not able to pass basic regulations for safety or emission. You might have heard about the a chinese suv which got zero rating in crash test- the dummy was fully destroyed. In middle east there are no such regulations so these cars are available. Talk to anyone who drives these cars, they will tell you how crappy and unreliable it is. Sorry, chinese are not japanese.

Back to SAIC-GM vehicles, I hope these are made with GM quality controls, and hence wont be bad.

PS: the book "Poorly made in china" is a nice read

I have been travelling to China for the past 9 years. During my last visit a couple of months back, i had the chance to be driven around in many of these "Biuck" vans. I should say the quality has improved tremendously and fit & finish was premium. The van looked good and was fully loaded with all gadgets that "worked". The drive though, was on the okayish side. I have always wondered why General Motors did not bring these vehicles to India.

I would suggest not to get to any kind of conclusion till these cars/vans get to our shores and our showrooms. IMO, these would be successful as they could be priced and positioned as VFM.