MACDRIVE
Jul 13, 2006, 02:22 AM
http://www.iht.com/articles/2006/07/12/business/auto.php
By Nick Bunkley The New York Times
Published: July 12, 2006
DETROIT Can the mystique of a British sports car be recreated by a Chinese company in America's heartland?
That is the bet by Nanjing Automobile Group, which plans to resurrect the fabled MG marque in a demonstration of how truly global the automotive industry has become.
Nanjing, which purchased the assets of the bankrupt MG Rover Group last year, is aiming to be the first Chinese carmaker to open a factory in the United States. At a news conference on Wednesday in Oklahoma, the company announced plans to build a newly designed MG TF Coupe there starting in 2008. It said that the coupe would compete with cars like the Mazda Miata, which sells for between $20,000 and $25,000.
It will also assemble a convertible TF Roadster version at MG's shuttered factory in Longbridge, England, and three sedan models in China. American and European operations for MG Motors is to be based in Oklahoma City, a few hours' drive from the new factory in Ardmore, Oklahoma.
MG's rebirth under Nanjing, which said that it had $2 billion in financing for the endeavor, comes as Chinese companies are setting their sights on the United States, the world's largest car market.
Several Chinese carmakers have said that they are two to three years away from exporting vehicles to the United States. One, Geely Automobile, displayed a $10,000 sedan at this year's Detroit auto show, although the car fell short of American safety and emissions standards.
Geely and Chery Automobile, a state- owned company that has sparred with General Motors over the similarity of its name to the Chevy nickname for the Chevrolet brand, plan to sell cars in the United States in 2008. Only Nanjing, however, has said that it intended to build vehicles outside China, where it would face higher labor costs than in its home country.
"We want to be a global company," said Duke Hale, a former executive at Mazda, Isuzu and Lotus who will be chief executive of MG Motors. "We don't want to be a company that simply exports out of China. We don't want to be seen as just another Chinese car company."
Nanjing also is unique among the Chinese car companies in its plan to revive an established brand with a Western following. Hale called that a critical advantage the company held over its Chinese rivals.
"I've got a brand name that still resonates," he said.
The company said that its lineup would be true to MG's heritage, to the delight of enthusiasts like Roger Parker, a technical consultant with the MG Owners' Club.
The club, run out of a large MG parts shop near Cambridge, England, has about 40,000 members worldwide. Many live in the United States, despite the brand's 26-year absence there.
"If they don't get the product right, they will certainly do damage that will be difficult to recover from," said Parker, whom Nanjing officials consulted about their plans. "It's clear that they are very committed and very conscious of the rich history that they have bought."
MG's limited appeal would ensure that Nanjing remained merely a niche player in the United States. However, construction of the first Chinese auto plant in the United States, which would create more than 500 jobs, carries a great deal of symbolism about the industry's future.
"It wasn't very long ago that nobody believed the Japanese would build plants in the United States," said David Davis, who co-founded Automobile magazine and runs an online publication for car lovers called Winding Road. After Lee Iacocca, the brash chairman of Chrysler, challenged them to do so, Davis added, "They did, and they blew everyone's pants off."
MG, originally called Morris Garages, began selling cars in the 1920s. Its iconic TC convertible was a big hit in the United States after servicemen grew attached to earlier MG models in Europe during World War II.
"MG was really an integral part of the foreign car revolution that started in the late '40s and early '50s," Davis said. "They weren't terribly good cars, but they were so different and they were so much fun to drive that we all forgave them for their lack of reliability."
The brand withdrew from the U.S. market in 1980. Sales continued elsewhere as ownership passed through several hands, including Honda and Bayerische Motoren Werke, until production ceased in April 2005 and all 6,000 workers at the factory in England were let go.
"It's the first sports car that I remember as a child," said Paul Fucito, who grew up around the corner from an MG dealership in New Jersey and remembers its closing. A spokesman for George Washington University, Fucito has never lost hope that he will one day own an MG and participates in several online forums devoted to the brand.
Several automakers have capitalized on demand for nostalgic nameplates in recent years, including BMW with its modernized Mini Cooper and Ford with the Mustang. Chevrolet has been deluged with requests to bring back the Camaro.
Jeremy Anwyl, president of Edmunds.com, a Web site that advises consumers about buying cars, said MG had the potential to join the list of successfully resurrected marques, so long as Nanjing kept quality high and prices low. "It's not just a question of slapping an MG brand on something and expecting it to be an automatic success," he said.
Anwyl said he expected to see the new MG models sporting the brand's recognizable vertical grille and octagonal logo but without the flaws that made early models frustrating yet endearing.
"Hopefully some of the electrical problems you wouldn't bring back," he said. "If you really want to go for nostalgia, you put on a leaky roof."
Shanghai Auto sells affiliate
Shanghai Automotive Industry, the Chinese government-owned partner of General Motors and Volkswagen, said Wednesday it had sold its auto manufacturing assets to its publicly traded affiliate, The Associated Press reported from Shanghai.
The deal, worth about 20 billion yuan, or $2.5 billion, would result in the core assets of SAIC being included in Shanghai Automotive, which has shares on the Shanghai Stock Exchange.
The deal dovetails with China's efforts to beef up the quality of assets listed on the stock exchanges following shareholding reforms that shifted billions of dollars in nontradable, mostly state-owned shares into the market.
By Nick Bunkley The New York Times
Published: July 12, 2006
DETROIT Can the mystique of a British sports car be recreated by a Chinese company in America's heartland?
That is the bet by Nanjing Automobile Group, which plans to resurrect the fabled MG marque in a demonstration of how truly global the automotive industry has become.
Nanjing, which purchased the assets of the bankrupt MG Rover Group last year, is aiming to be the first Chinese carmaker to open a factory in the United States. At a news conference on Wednesday in Oklahoma, the company announced plans to build a newly designed MG TF Coupe there starting in 2008. It said that the coupe would compete with cars like the Mazda Miata, which sells for between $20,000 and $25,000.
It will also assemble a convertible TF Roadster version at MG's shuttered factory in Longbridge, England, and three sedan models in China. American and European operations for MG Motors is to be based in Oklahoma City, a few hours' drive from the new factory in Ardmore, Oklahoma.
MG's rebirth under Nanjing, which said that it had $2 billion in financing for the endeavor, comes as Chinese companies are setting their sights on the United States, the world's largest car market.
Several Chinese carmakers have said that they are two to three years away from exporting vehicles to the United States. One, Geely Automobile, displayed a $10,000 sedan at this year's Detroit auto show, although the car fell short of American safety and emissions standards.
Geely and Chery Automobile, a state- owned company that has sparred with General Motors over the similarity of its name to the Chevy nickname for the Chevrolet brand, plan to sell cars in the United States in 2008. Only Nanjing, however, has said that it intended to build vehicles outside China, where it would face higher labor costs than in its home country.
"We want to be a global company," said Duke Hale, a former executive at Mazda, Isuzu and Lotus who will be chief executive of MG Motors. "We don't want to be a company that simply exports out of China. We don't want to be seen as just another Chinese car company."
Nanjing also is unique among the Chinese car companies in its plan to revive an established brand with a Western following. Hale called that a critical advantage the company held over its Chinese rivals.
"I've got a brand name that still resonates," he said.
The company said that its lineup would be true to MG's heritage, to the delight of enthusiasts like Roger Parker, a technical consultant with the MG Owners' Club.
The club, run out of a large MG parts shop near Cambridge, England, has about 40,000 members worldwide. Many live in the United States, despite the brand's 26-year absence there.
"If they don't get the product right, they will certainly do damage that will be difficult to recover from," said Parker, whom Nanjing officials consulted about their plans. "It's clear that they are very committed and very conscious of the rich history that they have bought."
MG's limited appeal would ensure that Nanjing remained merely a niche player in the United States. However, construction of the first Chinese auto plant in the United States, which would create more than 500 jobs, carries a great deal of symbolism about the industry's future.
"It wasn't very long ago that nobody believed the Japanese would build plants in the United States," said David Davis, who co-founded Automobile magazine and runs an online publication for car lovers called Winding Road. After Lee Iacocca, the brash chairman of Chrysler, challenged them to do so, Davis added, "They did, and they blew everyone's pants off."
MG, originally called Morris Garages, began selling cars in the 1920s. Its iconic TC convertible was a big hit in the United States after servicemen grew attached to earlier MG models in Europe during World War II.
"MG was really an integral part of the foreign car revolution that started in the late '40s and early '50s," Davis said. "They weren't terribly good cars, but they were so different and they were so much fun to drive that we all forgave them for their lack of reliability."
The brand withdrew from the U.S. market in 1980. Sales continued elsewhere as ownership passed through several hands, including Honda and Bayerische Motoren Werke, until production ceased in April 2005 and all 6,000 workers at the factory in England were let go.
"It's the first sports car that I remember as a child," said Paul Fucito, who grew up around the corner from an MG dealership in New Jersey and remembers its closing. A spokesman for George Washington University, Fucito has never lost hope that he will one day own an MG and participates in several online forums devoted to the brand.
Several automakers have capitalized on demand for nostalgic nameplates in recent years, including BMW with its modernized Mini Cooper and Ford with the Mustang. Chevrolet has been deluged with requests to bring back the Camaro.
Jeremy Anwyl, president of Edmunds.com, a Web site that advises consumers about buying cars, said MG had the potential to join the list of successfully resurrected marques, so long as Nanjing kept quality high and prices low. "It's not just a question of slapping an MG brand on something and expecting it to be an automatic success," he said.
Anwyl said he expected to see the new MG models sporting the brand's recognizable vertical grille and octagonal logo but without the flaws that made early models frustrating yet endearing.
"Hopefully some of the electrical problems you wouldn't bring back," he said. "If you really want to go for nostalgia, you put on a leaky roof."
Shanghai Auto sells affiliate
Shanghai Automotive Industry, the Chinese government-owned partner of General Motors and Volkswagen, said Wednesday it had sold its auto manufacturing assets to its publicly traded affiliate, The Associated Press reported from Shanghai.
The deal, worth about 20 billion yuan, or $2.5 billion, would result in the core assets of SAIC being included in Shanghai Automotive, which has shares on the Shanghai Stock Exchange.
The deal dovetails with China's efforts to beef up the quality of assets listed on the stock exchanges following shareholding reforms that shifted billions of dollars in nontradable, mostly state-owned shares into the market.
