Business / Industries

Spain might be beachhead for Chinese cars

(Xinhua) Updated: 2012-11-08 10:17

BARCELONA - A Spanish expert said on Wednesday that Spain might be the perfect place for the Chinese car industry to get a foothold overseas.

Jaume Ribera, professor from the IESE Business School in Barcelona, said one of the ways for Chinese-made cars to enter markets in Europe and the United States is to produce cars there.

"Opening factories in European countries and the United States is a way to open a market there and to become part of that country rather than a company that merely exports from China," said Ribera, also a professor of the China Europe International Business School in Shanghai.

Ribera said at the presentation of a report on Chinese car industry by the Shanghai school that there is one country that looks to be perfect for China to take such a step: Spain.

"The Spanish market is one where there are existing distributors, a strong automobile sector which has been established for a long time, places to install a factory and workers who are at the moment looking for work. It would be the perfect place for the Chinese," Ribera said.

Ribera made the talks in an interview with Xinhua at the 27th automotive industry meeting held on the IESE campus in Barcelona, pointing out that to merger is the future of China's car industry.

"What we discovered is the excessive number of car producers in China. We are talking about 120 manufacturers and it is impossible for all of them to compete," said Ribera.

He added that big cities such as Beijing and Shanghai simply do not have the capacity to hold more cars on their roads, which made it hard to sustain so many different manufacturers.

"We will have to look for fusions and my advice is the sooner that is done, the better. There are things that we don't like to do, but we have to do. The faster we start, the easier it will be to survive," he said.

China is now looking to export cars to countries such as India, Brazil and Russia.

"They are big and growing markets, so it is a good way to start," the Professor explained.

Ribera said he believes that qualities of the Chinese-made cars will improve the volume of production, pointing out that the gap in quality between Chinese and Western-made cars is narrowing.

"Quality improves with volume. So in terms of quality, Chinese companies will be able to compete in European and American markets, " he said.

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