China Now Comes to USA for Cheap Labor?

Re: [spiers] China Now Comes to USA for Cheap Labor?

Agreed on all points. I presumed you would argue that they would hire
US managers and that demonstrates superiority of Our managers versus
theirs. But you also agree that they will probably bring Chinese execs
to US to run the place.

I find this fascinating, because another approach is Bricklin's, who is
using the Spiers method, tailoring cars already made in the best place
(China he thinks) and bringing in Chery cars (and someone else is
bringing in Geely cars).

Perhaps the success will be determined by the design and quality of the
final product, rather than the nationality of the assembler? I wonder
who is designing them?

On Tue, 18 Jul 2006 12:56, John Spiers wrote:
> Exactly... China is going to do exactly what USA has been doing... "So
> they will take a
> respected name (MG), build it with high priced labor, use
> Chinese-sourced parts, and make
> good margins" Since USA pays the most for everything, they can do
> this.
>
> But a couple of points... if the Chinese can use high priced USA labor
> and make money, then
> labor cannot be critical. If they turn a nice profit, how so? since
> USA automakers cannot. If
> they do, the difference will necessarily be Chinese management, since
> all other factors will be
> the same.
>
> Another reason to make cars in USA is China has a labor shortage right
> now, and
> unemployment is rising in USA if you take govt jobs out of the
> picture. With inflation, USA
> labor has been getting cheaper.
>
> I agree China will sell these cars inside usa, because they will cost
> too much to sell outside
> the USA, any more than any other USA car will sell well outside of usa.
>
> Finally, the Chinese market is growing rapidly, so saturation is hard
> to gauge, I suspect there
> will be new car companies yearly in china, until the decide to leapfrog
> USA and go completely
> mag-lev.
>
> John
>
> On Mon, 17 Jul 2006 18:26:02 -0700, Paul Snyder
> wrote :
>
>>
>> I don't think it supports your theory about management. It's just an
>> investment decision. The Chinese auto market is super-saturated, so
>> Nanking Motors is looking to put their money somewhere it will grow
>> better. So they will take a respected name (MG), build it with high
>> priced labor, use Chinese-sourced parts, and make good margins. The
>> car will sell only in the US, I predict.
>>
>> On Jul 17, 2006, at 1:18 PM, John Spiers wrote:
>>
>> > Folks,
>> >
>> > If you believe cheap labor is a factor in int'l trade, then what do
>> > you make of China to build
>> > British cars in USA?
>> >
>> > http://tinyurl.com/lu9fq
>> >
>> >
>> > John

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