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General Motors sold some 2 million cars overseas this year, a drastic improvement, but realize that the global auto market is heating up, with other new market entrants. For instance Ethiopia now will be selling a 4-cyllinder, 5-speed sedan for only ,000 which will be made with Chinese parts. Other companies will have a tough time being able to compete, especially considering that Ethiopia has a huge import tax of 1.5 times the cost.
Many markets like this are opening up around the world and global auto-makers are business creating alliances and making deals to control labor costs and tap into these markets. Currently, in Ethiopia, the folks drive hand-me-down used cars from Europe. Now they will be able to drive newer cars, which are made in their own country and helping the labor supply there.
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It appears that although GM is making inroads and selling more cars in foreign markets, that there is quite a bit of competition out there in the overall global market. There is a rush to make the vehicles cheaper in order that the masses of people can purchase them. The question is would a middle class American buy an Ethiopia car made with Chinese parts? Well, that might not be as far off as you think. The first Chinese car dealership goes into New Jersey in 2008.
We are opening our markets to Chinese manufactured cars and these smaller mini-version cars and SUVs will most likely do well as it does not look like the oil prices are going to come down anytime soon.
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"Lance Winslow" - Online Think Tank forum board. If you have innovative thoughts and unique perspectives, come think with Lance; www.WorldThinkTank.net/. Lance is an online writer in retirement.
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