BAIC shows its interest in Saab

Article by Christian A., on August 27, 2010

More than ever, it has become obvious that China's automakers have a difficult road ahead of them to gain a global profile. General Motors still has not been able to sell Saab off to other parties and it doesn't appear likely that Beijing Automotive Industry Holding Corp., which has shown interest in the brand, will be successful.

China's automakers already dominate their home market but like BAIC, they want to quickly get to the global market. One of the fastest ways would be to snap up assets from troubled Western carmakers such as GM but it appears that it's not the easiest path to take. 

Generally, the Chinese produce low-end cars for its domestic market and they don't have the technology and management and marketing expertise to handle global brands.

At the Guangzhou Auto Show in southern China, these carmakers boasted to have record sales this year and they expect to have more growth next year.

But then, they're clearly not prepared to take on global giants such as Toyota Motor Corp., GM and Volkswagen AG. Zhang Jing, an analyst at Phillip Securities, explained that the products are focused on the low-end market and cannot meet requirements of the western world, such as Europe.

As proof, he pointed out that these carmakers aren't even eligible for an entrance permit and that means that they still have a long way to go before they reach the stature of the global brands. [via reuters]

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