Chinese US Strategy Is To Undercut The Competition On Price - Will That Alone Be The Key?

For some yes...for most reliability and design need to be there too.

Does anyone remember when Russian Lada cars first came to North America? Some people bought them for their exceptionally low price. In short order, they earned a reputation for exceptionally low build quality and reliability. Now, when you mention Lada cars in North America, most people go "huh?"

The same might happen to Chinese vehicles. My understanding is that many Americans like a bargain, but not at any price. The '64 Mustang personified that. It sold at around the price of an ordinary car, yet its styling was beautiful, it had more features that you'd expect, and its build quality was on part with the industry. That was a winning combination.

In other words, many Americans want a low-priced car, but they don't want to feel like poor people. If you attempt to sell them junk cars at a low price, you might end up like Lada.

China should face the exact same Tariffs they impose on every other nation and mfr that sells in China. ZERO cars sold in the US unless they build here, and can find a JV partner, as required in China.ZERO! Otherwise, TARRIF every single car... they WILL if allowed to, decimate the industry in the US...

xjug1987a: You miss the fact that China has us over a barrel because they have two things we desperately want: (1) A massive cheap labor force, and (2) a massive ocean of prospective consumers. We want more of what they have, than they want what we have. That's why they're dictating not only to us, but to the rest of the world, too.

I believe they'll win, because we have a deeply rooted element of greed in us. We practically worship money, and the lure of getting more of it is so enticing, that we'll often hurt ourselves to get it.

Greed... great word "socialist". Free Enterprise means I create a business to fulfill a market need. Or create a need like Apple, then satisfy that need and guess what, I profit from that service or need fulfillment. Check for Apple, or any other "corporation". Greed... shesh... Profit allows me/them to invest in new products & machinery, or hire more people to grow the business. It also allows me to buy a new Chevy or elevate to a Buick or someday a new Cadillac. Or put my kids through college. The more I earn the more taxes I can pay or give to charity. America is the most charitable nation on earth and in the history of mankind… “greed huh”. Well greed IS good!

The Chinese are about themselves so power, domination of those they see as lesser, which one could label as "greed" is what they're about too, except they're Communists and they don't play by any rules. So they use their own people for slave labor, and repress freedom of expression, however they do have a significant and growing middle class, but freedom is something they experience when they come here to visit. Anyhow self-interest has brought about the greatest standard of living for the largest number of people than any other form of Govt. Greed huh….

The Chinese FORCE companies to give them their technology and "share" it with their JV partners, also a requirement. They place tariffs on imported goods/vehicles such that no one would buy them as they're priced at the top of the market. So, companies give in and yes, they have cheap labor but also they're buying more cars than we are so it’s a huge market. A market to sell products and to make “profits”… greed huh?

So, my comment is tariff their exports to the US EXACTLY the same as they impose on us. Thus they have no advantage and their products must stand on themselves. Level the field and have a zero tolerance level for their cars. Zero freebies for China. Remember, they play by their own rules that change as they determine. Look at all the cars they copy, I mean they have no respect for copyrights or international trade laws. Yes, they have a huge market and cheap labor, but they control their market with their rules and we should do the same. If we do that perhaps they’ll relax their tariffs so our manufacturers make products here and our people have mfg jobs…. Which according to you creates more greed…

Don't think for a second Chinese cars will be like Lada's... They have access to global automotive technology via their imposed "Joint Ventures" they force on manufacturers who build in China. Their cars might not be state of the art at the moment but neither were Kia's & Hyundais a few years ago. The Chinese play by their own rules so we need to play by ours. We cannot control their market but at least for the moment, we can still control ours... Agree w/xjug 110%.

@ TheSteve - what are your thoughts on how to compete with China? They are now requiring manufacturers to provide them with all the technology I when doing business in China. They will not be Lada for long. So at some point it will come down to cheap labor. Should US workers lower their standards to compete with China? I believe this strategy would be a disaster for the US. I don't want to see the US lower the salaries of its labor force, cut back on our safety standards, remove our environmental standards and turn into a 3rd world country just to compete in China. There are plenty of other trade partners we can do business with on a more level field.

Too bad, but practically the U.S., Koreans and the Japanese automobile companies will lose a lot of customers, since many people will prefer the Chinese cars.

All those symbols look like they were lifted right from a UFO...

Undercutting prices by 30% will certainly be attractive to many people. I am sure the usual questions will arise...are these cars safe, reliable, do they comply with US regulations...etc.

No one is going to cut back on standards to compete. How stupid would that be? Of course, you might see Detroit offer up another Vega or Pinto in response, lol.