China, India emerge as major auto players

• Source: Global Times
• [00:37 January 14 2010]
• Comments

Fred Ni, general manager of BYD Auto Inc., introduces the 2010 e6 electric vehicle. The Chinese battery and car maker hopes to launch US sales later this year.

China and India could reshape the global auto industry and pose a significant competitive threat in the coming years, executives from the world's top carmakers said Tuesday at the Detroit auto show.

"They are a very credible threat and we discount anyone at our peril," said John Mendel, vice president in charge of sales at American Honda Motor.

While the globally competitive nature of the automotive industry requires mass economies of scale, the relatively young Chinese and Indian manufacturers are ramping up quickly, Mendel noted.

And the Chinese carmakers buying brands like Hummer and Volvo are gaining access to a valuable distribution network, critical technology and "instant credibility," he told AFP.

With the world's cheapest car, India's Tata Motors will take its opening shot at the US market today, as China's Build Your Dreams Motor (BYD) brought its four-door electric e6 straight to the floor of the auto show, where it vowed Tuesday to enter the US at the end of this year.

Meanwhile, both countries are becoming increasingly important markets for carmakers, with China topping the global sales volume last year and India expected to double its sales by 2016.

But Toyota's chief of US automotive operations expressed skepticism that either BYD or Tata would make a heavy mark in a short term.

"Whether it be Toyota, GM, Ford or Chrysler, we have more resources, more manufacturing capacities and more technical development available here so we should be able to deliver a better product," Don Esmond said in an interview on the sidelines of the auto show.

Carlos Tavares, Nissan's executive vice president in charge of the Americas, disagreed and noted the success of Korean carmakers Hyundai and Kia in breaking into the US market, overcoming quality concerns and becoming major players.