Chinese Car Plant Opened in Bulgaria

[Stephanie Kopf]

Everyone’s talking about it: the Chinese superpower is rising. Of course this becomes all the more obvious once you take a look at various statistics about China, but this recent report underlines a trend that will most likely persist in to the future.
[link:http://www.spiegel.de/international/business/0,1518,816851,00.html|
Spiegel Online International] reported a few weeks ago that China had opened its first car plant in Europe. A Bulgarian village called Bahovitsa is now home to Great Wall Motor. The article notes, “It used to be that European carmakers opened plants to assemble their cars in China. Now the Chinese have turned the tables with the opening of their first factory in Bulgaria, an EU country with low labor costs and taxes. Increasingly, Chinese carmakers are setting their sights on the European and American automobile markets.” Bulgaria’s Litex motors will join Great Wall in managing the company.

Great Wall has an impressive plan for the next three to five years, according to the article. Some test assemblies already began in November. Generally Great Wall aims to assemble some 50,000 cars per year. Bulgaria and other Eastern European countries are the first target markets, but plans of expansion in to Western European markets are of course the long-term goal.

[dmallind]

1. Good move

Test the waters in less demanding markets, learn how to improve quality and targeted aesthetics, then move into the bigger EU and NA markets. Just like Japanese and Korean cars before them I have no doubt Chinese cars will initially come herre as price leaders and then quickly move the whole market into more competition for features, design and even quality. Local markets get investment - statrting with Bulgaria, China becomes more globally integrated into higher end manufacturing and trade, and consumers get more product choice.