China’s Chery: Not Quite Ready for Outback Prime Time

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Time for my latest comment on China’s homegrown automakers, and how they’re not quite ready for global prime time despite making noises in that direction. The latest to make such rumblings is indy superstar Chery, which has entered the Australia market with plans to sell — gasp — a whopping 5,000 cars there this year! (English article). Granted that Rome wasn’t built in a day, but 5,000 is hardly going to give these guys a jump start in Oz anytime soon. If we were going to handicap this race to export to the West, I’d have to give Beijing Automotive Industry Corp (BAIC) and perhaps Geely (HKEx: 175) pole position, perhaps followed by a weaker SAIC (Shanghai: 600104) and maybe BYD (HKEx: 1211), all of which have  some kind of foreign connection. Chery may see the global market as ripe for its picking, but sophisticated Western buyers might find this offering, with a cheap price tag but little else in its favor, still a bit green.

Bottom line: Chery’s foray into Australia won’t go anywhere fast, with BAIC and Geely standing the best shot at being first to penetrate Western markets.

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