Why Chinese Car Brands Are Stuck in First Gear

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7/11/12 Why Chinese Car Brands are Stuck in First Gear Publication: The Economic Times Mumbai;Date: Jul 7, 2012;Section: Global Business;Page: 6 SLOW WHEELS Why Chinese Car Brands are Stuck in First Gear Local brands make up only about 30% of their home market, the lowest proportion of any major economy ike many Chinese, Zong Zhaoxiang wishes nothing but the best for the Chinese car industry – yet he won’t be buying a Chinese car anytime soon. The 52-year-old chairman of a Shanghai chemical company, Zong said he expects Chinesebranded cars to have bright prospects. However, he loves the comfort, quality and image projected by his black Mercedes-Benz S-class, and he said he may buy another Mercedes-Benz model or a BMW in the…show more content…
But building a luxury brand is difficult and time-consuming – perhaps even impossible, said Philippe Houchois, an auto analyst at UBS. epaper.timesofindia.com/Repository/getFiles.asp?Style=OliveXLib:LowLevelEntityToPrint_ETNEW&Type… 1/4 7/11/12 Why Chinese Car Brands are Stuck in First Gear Quality & Tech Gaps The luxury segment may be off-limits, but some Chinese companies have been able to move somewhat up-market. SAIC successfully entered the high-end market in the last few years with the release of “Roewe,” a brand based on intellectual property acquired when British car maker MG Rover went bankrupt in 2005. Geely, a private car maker that acquired Swedish brand Volvo in 2010, has also won market share by gathering its high-end products together under one nameplate, “Emgrand.” Overall, however, few Chinese carmakers have been able to establish a reputation for quality and comfort. Sometimes this is merely a matter of lagging consumer perception, but often there are still quality and technology gaps between foreign and Chinese brands. Analysts said many Chinese companies also tend to face operational challenges. Even if a company has mastered advanced technologies,

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