• Another move by Chinese car maker to enter U.S

Another move by Chinese car maker to enter U.S
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BMW’s Chinese partner Brilliance, has signed an initial agreement with two U.S firms Rocket Capital and McCombs, to distribute their sedans in the U.S. The two billionaire firms will also help Brilliance in finding after-sales support.

This is not the first time a Chinese car maker has tried getting into the U.S. Previous attempts were futile as the low-cost copy cars failed in meeting safety and emission norms.

A lot of money will change hands in this deal- Brilliance will trade in 10 to 15% of its shares in exchange for $100 million from both clients.

Other Chinese manufacturers like Geely and Chery are also looking at overseas markets like U.S and Europe. Their profile will then read international as they try escaping fierce competition at home. Ambitions are high for these desirous brands- Brilliance plans to acquire 1 % of the European market by 2010. It is presently doing well at home and is well on its way in completing its second plant in China, which when commences production in 2010, will churn out 100,000 cars annually.

Pathetic brand image and poor quality are the two major issues that Chinese cars have to get rid of. The expectations and requirements of a developed nation is poles apart from a developing one. Safety and eco-friendliness are other prime areas which need attention as they are the basic and compulsory needs in order to qualify selling in global markets. Cater to all that and the market will determine the rest.


Source: Reuters

Shrawan Raja
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