I am continuing the discussion to keep you guys interested. As I mentioned above that presently Chiese automotive market is enjoying the benefit of hugel sales volume. Lets take the example of car mentioned by brother charter ali.
Hyundai is a 1.8 ltr mid size sedan comparable to corolla in price and performance. A middle class Chinese family can easily afford it. There are about 4.5 million fmilies living in Beijing only which has a population of over 15 million. For reference the population of Islamabad is below 1 million and Karachi is about 13 million. Other than that Elantra is selected as taxi for Beijing and many other cities. Presently the demand for this car is so high that Hyundau Beijing plant is unable to meet it inspite of working 24 / 7 since last two years. For each part there are mulitple vendors as it is beyond thier capacity to fill the orders. In the last six months the units sold are 85000. This makes almost 500 cars per day. It is a massive volume for the factory to handle.
Now as the manufactuing work is subcontracted to other manufacturers located all over the China, the parent cmpany has to share master designs, tooling, machine codes and other manufacturing details. Its hard to control the flow of information. Chinese government is not serious about IPR laws and has dileberately closed its eyes on this issue. The purpose is to enhance the technological base of its local industry on the cost of foriegn companies.
Actually Chinese suffered heavily in case of mobile phone industry where they agreed to pay royalties to the actual designer. In a couple of year China became the largest user and producer of mobile phones ( which was not expected
even by the Chniese themselves). Principal manufacturers like Nokia, Motorola etc made billion of $ just as royalties without doing anything. That was a lesson for the Chinese and now they make sure that no such thing happens because they are
Larget produce / consumer of airconditioners
Larget produce / consumer of TV sets
Larget produce / consumer of washing machins
Larget produce / consumer of ciggarettes
2nd Larget produce / consumer of cars
Larget produce / consumer of computer and accessories
Larget produce / consumer sport shoes and apperal
Largest exporter of garments, shoes and stationary
etc etc
As a result of this Chinese have thier own brands of consumer good, electronics, autos etc which are almost as good as foriegn goods but way too cheap and can be afforded by everyone.
For Rs 250,000 (Chinese equicalent RMB 30,000) you can buy a reasonable car much much better than Santro, Cultus etc in Paistan. A mid size sedan will cost you RMB 50,000 and an SUV will be around 100,000. The benefits of prosperity are being transferred to common people, living standards are rising anf thus consumer market is flourshing.
Its time Pakistan businessmen should look into Chinese market, not for products but for technology transfer. The technology available is good, cheap and above all still available.
