These should be good times for Chinese automakers as they prepare to show off their latest models at the Shanghai auto show.
Their home market is the world’s biggest and growing. But independent automakers such as Chery and Geely are being squeezed by bigger, richer global rivals including General Motors and Nissan that have moved into turf the Chinese makers considered their own: low-priced models for local tastes. Domestic brands account for less than half of their own market.
“At a time when the Chinese were getting ready to move upscale, they have come under siege in their area of traditional strength,” said Michael Dunne, president of Dunne & Co., a research firm. “They didn’t see that coming and it hurt.”
Fighting back, Chery, Geely and local rivals Great Wall and BYD are scaling down ambitious expansion plans and focusing on improving quality. Some hired managers or designers with experience at Mercedes Benz and other foreign producers. Others aim at specialties such as SUVs, minivans for export to other developing countries and electric buses.
This week, Chery Inc. announced a corporate overhaul after sales plummeted 10 percent last year. The company said it will shrink its range of 20 models to 11 or 12.
BYD Co., in which American investor Warren Buffett’s Berkshire Hathaway Corp. owns a 10 percent stake, plans to display a new SUV and its Si Rui sedan at Auto Shanghai 2013, which opens Sunday.
The company, China‘s leading maker of electric cars, blamed intense competition for a 94 percent plunge in profit last year and says the midsize Si Rui should help to drive a rebound.
Great Wall Motors Co. plans to debut two SUVs, a pickup and a sedan among 23 models on display. Last year, the company was China‘s top-selling independent automaker on the strength of its popular SUVs, which are exported to 80 countries.
China‘s failure to follow its neighbors Japan and South Korea in creating at least one global auto brand — even after this country passed the United States in 2009 as the biggest auto market — has frustrated communist leaders.
They see auto making as a national priority — the “industry of industries” that supports higher-paid jobs in fields from manufacturing to electronics to chemicals. They have spent
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