Roger Wood, the president and chief executive of Dana Holding Corp., a major American automotive-parts company, is sounding the alarm that the Red Menace has turned the tide in its homeland of China and will soon be producing cars and parts that are close to equal to what foreign companies produce.
“Foreign players in the market will see a lot greater local competition than they have seen in the past,” said Wood. “Chinese auto makers recognize the need to build more-robust vehicles that can satisfy Chinese car buyers’ technological needs.”
Wood says that improving quality is only part of the reason that the average Chin Lee is beginning to want a Chinese vehicle rather than a Ford or BMW; that reason is patriotism. “There’s a shift by consumers from wanting foreign brands to wanting local ones,” Wood said.
Some auto parts manufacturers are ready for the battle. Wood says that Dana, after years of primarily selling to global customers in China, has already begun to sell parts to Chinese automakers, who prefer the parts because they are of higher quality than the parts made by Chinese auto part makers.
The shift, if it continues, could prove to be very troubling to foreign automakers. With China being home to the world’s largest auto market, auto makers depend upon it along with the auto markets in the U.S. and India to save it from the red numbers they are bleeding in Europe.
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