U.S. plans fizzle for most Chinese vehicles

(Credit: Automotive News)

Plans by Chinese automakers to enter the United States have largely fizzled.

Chery Automobile, through a deal to assemble cars for Chrysler, stands a chance of entering the United States by 2011.

And Brilliance Jinbei Automotive, a small Chinese automaker, says it plans to sell cars in the United States in 2009.

But other Chinese import plans are in disarray.

Enthusiasm for Chinese vehicles was created mainly by hype from American promoters and wishful thinking from small Chinese automakers who were unaware of the difficulties of selling cars in the United States.

In July 2007, Tom LaSorda, then CEO of Chrysler, announced a deal in which Chery would assemble vehicles for

But since the announcement, Chrysler has revealed few details about its relationship with Chery. A major supplier to Chery says Chery has no definite timeline to begin exports to the United States for either Chery- or Chrysler-badged vehicles.

"We need small cars," LaSorda said in May. "Chery's cars are still not ready for that exposure into these markets." He said China-built cars probably won't be ready to meet U.S. safety and emissions standards for "three years or more."

By year-end, Chery plans to start shipping its A1 small car to Mexico, where it will be sold with a Chrysler brand. Chrysler and Chery also are creating a vehicle for developing markets that will not be sold in North America.

Also in Mexico, a major Chinese automaker, China FAW Group Corp., says it will operate a plant there. In December, FAW established a joint venture with a Mexican partner to produce by 2010 two FAW-badged small cars for Mexico and Central America.

MG project dies
Meanwhile, plans by other Chinese automakers to sell vehicles in the United States have largely evaporated.

Oklahoma City investor Marc Nuttle devised a plan with Nanjing Automobile Group to produce MG sports cars from kits in Ardmore, Okla. Production was scheduled to begin this year, but the plan appears dead.

Financially troubled Nanjing was acquired in December 2007 by another Chinese automaker, Shanghai Automotive Industry. MG production began August 1 in Great Britain.

A SAIC spokeswoman said she has heard of no plans to proceed with the Oklahoma project. Calls to Nuttle have not been returned.

Oklahoma does have one small-scale Chinese project under way. Tiger Truck in Poteau, Okla., is increasing production of two pickups designed by Chongqing Changan Automobile. The Chinese automaker plans to eventually produce 8,800 per year.

The pickups have not passed federal safety and emissions standards, so Tiger Truck has sold them since 1999 for off-public-road uses, such as construction sites. But Oklahoma's governor signed a law making the trucks legal on Oklahoma roads, except for most federal highways, starting in November.

In 2006, Zhejiang Geely Automobile Group, a small but up-and-coming automaker in China, said it planned to enter the United States in 2008. But the company backed away from that timetable and now is saying little specific about its plans.

In a statement to Automotive News, the company said: "We have a clear goal for our product: the most environmentally friendly, the safest, and the most fuel-efficient car.

"We do not want people to think that the China-made car will win on price alone. We believe at the correct time we will enter the North American market. We are convinced that this will not be in a very long time."

Chamco meltdown
The meltdown of would-be distributor Chamco Auto, of Parsippany, N.J., killed another plan to bring Chinese vehicles to the United States. Operations of Chamco, accused of fraud by former employees, are controlled by federal courts.

Chamco had planned to import vehicles from Hebei Zhongxing Automobile, a minor Chinese automaker. Zhongxing says it canceled its contract with Chamco and says it is talking with other possible importers.

In recent years, various Chinese automakers, such as BYD Auto and Hunan Changfeng Motor, have displayed vehicles at Detroit's North American International Auto Show. But the companies have not revealed specific plans to enter the United States.

Brilliance Jinbei said it plans to show cars in Detroit in January and sell cars in the United States in 2009. But it declined to provide details.

(Source: Automotive News)