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Chinese experts have been suggesting that the Chinese auto market will be the only market projecting growth in the coming years. Currently, China’s auto market ranks second to the Big 3. Some financial analysts are suggesting China’s auto market will experience 5 percent growth annually. China has much to gain if the Big 3 does not get the bailout.
If past unbalanced trade practices produced the Big 3 struggle for survival, then now is the time to tip the scales a little. It’s no secret that the Big 3 has added to its own demise, no one could have predicted a downturn in the economy beginning in the mortgage industry would trigger such a domino effect in all sectors of the economy. When all the other business sectors began failing, each industry was exposed, and signs of corporate fiscal irresponsibility were revealed. Read more about Chinese Carmakers.
GM experiences global sales growth as much as 19 percent due to sales increasing from China, Russia, India and Brazil. The automaker currently depends on foreign automakers for one fifth of all their global business.
That’s a huge dependency for an automaker that is so cash poor. GM’s Chinese partner SAIC, is already an auto giant in China and is said have "deep cash reserves." Owners of SAIC are said to be preparing to step onto a “new stage of healthy growth” if the Big 3 fail.
The survival of the Big 3 is integral to the financial fabric of a country that is weakening on many financial levels. While the U.S. auto market share is shrinking, China’s auto industry is experiencing 8 percent growth year over year. With this type of growth, China stands to inherit the reins of a still growing auto market. The Big 3 would become reliant on Chinese automakers for survival.
The Big 3 must be persuasive when they go to Capitol Hill today. They’ll need a solid plan of action in order to walk away with a $25 billion government loan. The automakers are going to need to prove they are have plans that include the development of more green vehicles. As well as executive and employee pay cuts. Congress will have to get over any previous biases they've held against the Big 3 as well.
However, biases need to be sidelined in order to really see into the needs of the Big 3. A government bailout would prevent a global financial crisis in the auto industry. If the bailout doesn't happen, the main benefactor will be China.
Kellie Wang from Gasgoo has contributed to this story.
Posted December 2nd, 2008 by Offbeatnews
I think the chinese carmakers are going to give the Big Three as much headache as the Japanese Carmakers do. I suggest you read the end of the third paragraph of this article where it points to the Chinese Carmakers. You can see how much power they have got. Not being in U.S. Market yet does not mean they are not a competition.
You guys might want to read this http://www.huliq.com/24824/car-industry-booming-in-china
The car industry is booming in China.
Chinese cars - ha ha, yeah, now I know you are kidding...
Who has even heard of a Chinese car? This a joke - Japan and Europe car makers will benefit and are in the prime position to take over the market. Chinese cars? Give me a break... I mean, would you drive one - think safety and quality control... yeah, right...
This is all speculation anyhow, there's just no way the US government is going to let the any of the Big 3 go down easily, too many jobs rely on them - it would be a disaster for the US economy.