Tuesday, February 22, 2011

Will China's BYD Bring the F3DM to the U.S. or will this be Just Another Broken Promise?


When it comes to making cars,China is king. We’re talking the world’s largest car market, with over a hundred individual marques. So why is it that there are virtually zero Chinese car manufactures selling cars in the U.S. aka the world’s other largest car market?

So far, China’s “Big Four” (well, the four most visible to those outside of China) have made and broken promises of bringing their vehicles to the North American market. Brilliance, Chery, Nanjing and Geely have all backed down from their plans to open dealerships and factories stateside. So far, not a single car from China's major automakers has touched down on U.S. soil outside a motor show.

Senior analyst Bill Visnic of Edmunds.com explains why: “This isn’t computers or cellphones, where you just get into a big-box store. You need some dealerships, and those things are tremendous investments of time and resources. [The Chinese] thought it was going to be a lot easier than it was.”

BYD hopes to change all that. China’s sixth largest automaker provided plug-in hybrid cars to the 2008 Beijing Olympics and now plans on bringing that hybrid, the awkwardly , named F3DM to the U.S.A. for Spring 2012. It still could be an uphill challenge, though.

The fallout from the slump in auto sales after the Global Financial Crisis, the government’s bailouts of two of the Big Three, the liquidation of numerous dealerships and the reduction in hybrid sales that came with the sudden drop in fuel prices is still being felt in much of America’s automotive heartland. Add to that the small market share commanded by hybrid and electric vehicles – just 2.2% worldwide according to JD Power – and BYD may be in over their heads already.

AS Mike Omotoso from JD Power explains:

“Because consumers are wary about electric vehicles and their driving range and batteries, they are even more likely to go with more established companies like G.M. and Nissan. The problem with the Chinese car companies is they are trying to run before they walk.”

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