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December 1st, 2008
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Chinese cars trouble competitionCritics cite safety but carmaker calls the crash tests unrealisticBy František Bouc Staff Writer, The Prague Post November 23rd, 2005 issue
In late October Martin Emes, the owner of Auto Diskont, the country's third-largest used car dealership, began suspecting he was being followed. Then he received his first in a series of death threats. Now he has a bodyguard. Emes can't be sure who's making the threats, but he says has a good idea what's behind them. At the end of October Emes, a Welshman, announced plans to begin importing cars from China that cost a fraction of the price of models currently available on this market. While some industry experts have raised concerns about the safety of the cars, their price advantage is so significant that they would cut into the sales of other brands. The cheapest model, manufactured by a company called Jianling, would go for around 100,000 Kč ($4,000). Its closest competitor here costs twice as much. "These extremely cheap Chinese cars could threaten the sales of other brands in this country," said Vratislav Kulhánek, president of the Automotive Industry Industry (SAP). The market for low-cost cars may appear saturated at first glance, but Emes said his announcement has so far prompted an unprecedented level of interest. The company received so many inquiries and orders that its Web site crashed.
'The demand is huge," he said. "We've received hundreds of e-mails. Traffic at our place has tripled, and our infoline was permanently jammed, despite the fact that we tripled the number of operators." Auto Diskont will announce by the end of November when it will start selling the cars. Safety risks Auto Diskont is considering cooperation with two Chinese manufacturers: Jiangling and Geely Automobile. Both are looking for partners to help them export to the Czech Republic but so far haven't found much interest. Jiangling first introduced its product to Europe in July. This was followed by a presentation at the prestigious Frankfurt International Auto Exhibition in Germany. The company invited Anthony Denny, owner of AAA Auto, the largest used-car dealer here, to see the cars, hoping he would consider importing them to the Czech Republic and other countries in Central and Eastern Europe. Denny turned down the offer because, he said, the cars didn't comply with European Union technical and safety requirements. Tomáš Lachout, sales manager at AAA Auto, said the cars were made of poor-quality material. He also noted that the cars failed crash tests performed by the Association of German Automobile Clubs (ADAC).
"According to tests by the ADAC, a crash at the speed of 64 kilometers [40 miles] per hour could be fatal in the case of Jiangling's Landwind model," Lachout said. "This was the worst test result ADAC has recorded in the past 20 years." The ADAC did not respond to an inquiry about the test. Landwind off-road is the first model manufactured in China to be offered in Europe. It costs 15,000 euros ($18,000/450,000 Kč). Autobild, a renowned German automotive magazine, recently criticized the model, writing that its frame was "so soft it's as if it was made of recycled tin cans." Jianling did not respond to a request for comment on this story, but the Chinese manufacturers have publicly questioned the legitimacy of the ADAC test. They pointed out that their cars passed crash tests by the TÜV car inspection office, also in Germany. Auto Diskont's Emes said the ADAC tested the Landwind under questionable circumstances. The tested vehicle did not have standard reinforcements that increase the strength of the front chassis. The manufactures have added the reinforcements to market their cars in Europe. "This is how the West European car makers are trying to discredit Chinese carmakers," Emes said. "They can't compete with them on price and are afraid of competition." Emes said he won't be discouraged by negative reports about the quality of the Chinese imports or threats against him or his family. He's going to continue his plan to bring the Chinese cars to the Czech Republic, regardless of the consequences. František Bouc can be reached at fbouc@praguepost.com Other articles in Business (23/11/2005):
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