Chinese Car makers to Govt: “We need bailing out too!”
It seems that in the end of 2008, the hottest buzzword is ‘bailout’. Many western banks got their bailouts (although I dont quite understand why my tax money was used to bail out the people I owe money too, my debtor is now indebted to me, perhaps we should call it quits) GM might get a bailout, Chrysler might get a bailout, and Ford might get a bailout, and so, Chinese makers have started looking towards their own government with ideas of bailout, except it appears to be the quint essential ‘Bailout with Chinese characteristics‘, which in short means: Lower taxes on green cars, and raise tax on fuel.
The New York Times elaborates further:
GUANGZHOU, China — Do Chinese automakers need a bailout?
China’s car industry is quietly pressing Beijing for government help as it copes with a jarring slowdown, top Chinese auto executives said in interviews here on Tuesday.
This autumn, after six years of 20 percent or more annual growth, vehicle sales were flat or slightly negative, a shock to an industry that has borrowed heavily to build ever more factories for a market that had once seemed insatiable.
Citing the $25 billion in loans that Congress has already approved to help American automakers increase green research, and the additional $25 billion in loans the American industry is seeking this week to cope with a hobbled economy, Chinese executives are now telling the government here that they also need emergency measures. They are seeking lower taxes on new cars, lower fuel prices and increased grants for research into hybrid cars and new technology.
“The Chinese government will undoubtedly support us,” said She Cairong, the general manager of JAC Motors, adding that state-owned Chinese banks had already become more willing to lend money to Chinese automakers in recent weeks as bank regulators have eased restrictions on loans to heavy industry.
Still, Mr. She and other industry leaders said that while government officials have voiced concern to them about the industry’s deteriorating condition, Beijing has not committed to any specific help.
“They’re asking the questions but they haven’t said anything yet” on how aid might be structured, said Frank Zhao, vice president and chief technology officer of Geely Automobile Holdings. “We really hope the Chinese government will come and help us.”
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Dear Colleagues,
Believe that Government will assist not only now the Chinese Automakers but always on the way to consolidate their brands.
We have to think that the Chinese Government is Omnipresent and acts in defence of PRC and its Companies, Economy and Folk.
We can see that a great opportunity will come with the possible pulverization of the North American Industry, what would result in a great chance to enter markets where is quite difficult to arrange dealers and build up logistic structures, assembling plants and so on.
Would be possible that in short terms Chinese Automakers start to acquire the bunkrupted companies from USA and some others (to follow from Europe) which would enable them to stack quicklier into those markets which have been quite difficult to enter.
Independing from the fact that there are many Automakers in China, the action could be easily coordinated by the Government. Because Just They Can!!!
J.I.Hosang
From Brazil!!!
Let them swim, the ones that drown deserve to, the ones that struggle on deserve to win, its called attrition and to bail out is totally wrong, and this also goes for the three ex biggies in the USA, if you behave like dinosours then you become extinct, the natural laws of selection apply here as well.
It would make more sense for the PRC govt to bail out its people first instead of a bunch of 2nd and 3rd rate car parts putter togetherers!
I can’t figure out why a government would bail out companies that make nothing (AIG?)…I mean nothing except paper…Yet when we see a primary industry like steel and autos (PS they can be retooled for tanksin time of war, banks make zero, except paper cuts) go down it’s okay? Dum UAW sez they aren’t going backwards…Got news for you UAW asses I have 2 college degrees and I’m making less (inflation adjusted) than I did in 1991. PS Change or die. When I see friends of mine who work at CAT making 140k+ and living in hoods with lawyers and docs there is something wrong real wrong, real wrong. As far as the Chinese auto companies please call the PRC and have them call in the chips and dirt they have on Crazy Willy Clinton. I’m sure some of the 700 billion dollars can be moved East. Just a thought, at least you guys know the value of a dollar.