Motoring @ AsiaOne

The Great Beep Forward

Car-crazy Singaporeans are snapping up cheap made-in-China cars, and motor companies trying to clinch new Chinese franchises are going along for the ride
Christopher Tan

Sun, Feb 25, 2007
The Straits Times

Red-hot China may be famous for its fast-growing economy, but there's another area where it is revving up as well - the pace at which its cars are making inroads into the Singapore motor scene.

This time last year, there were no Chinese makes on sale here. Now there are nine models set to rival the familiar Toyotas, Nissans and Hondas.

Their cheap prices are proving irresistible to car-crazy and budget-conscious Singaporeans wanting an economical car to zip around the island in.

The cheapest, the 800cc Chery QQ hatchback, costs just $29,000. That's about $6,000 less than Korea's Kia Picanto, which is the next least expensive car you can buy here.

The demand for mainland cars is healthy despite nagging suspicions over their durability and safety standards - issues which have been raised by online car forum participants here as well as overseas.

In the seven months since Chery went on sale here, about 370 units have been sold. That's an average of 52 cars a month - or 30 per cent of Kia Picanto's monthly sales.

Another mainland make, Geely, which was launched only in November, has delivered nearly 70 cars to happy China converts.

Retiree Guo Ren Huey, 79, has watched the arrival of Chinese carriages with interest.

The former civil servant said he might have bought one if he was in the market for a car. "I don't like Japanese products," says the man who was a resistance fighter during the Occupation.

He points out that this is not the first time China-made cars have been here.

He says they first arrived over 40 years ago.

"It was in the early 1960s, and a few of the Red Flag sedans were displayed at the former Great World," he says, referring to where the present Great World City stands.

"The cars were based on Russian technology, and were very heavy and consumed a lot of fuel. Because of that, they never succeeded in selling here."

Last year, the Chinese tried again. Cue the QQ which, since its entry, has reigned supreme as Singapore's cheapest new car.

Now, the cohort of Chinese models stands at nine: three from Chery, two from Geely, one Dongfeng, two from Soyat, and one assembled by Malaysia?s Naza group.

The Dongfeng and Soyat cars are still undergoing Land Transport Authority (LTA) approval processes.

Chery's new offerings are a sedan and a sports-utility vehicle. Both Geely models are sedans. The Dongfeng model is a jeep-like seven-seater, while Soyat has a mini-van as well as a goods-cum-passenger vehicle.

Elsewhere, Malaysian distribution giant Naza has started exporting its Naza Sutera here. The 1.1-litre Sutera is based on a Chinese car called Hafei Lobo.

Start your engines

And it is just the beginning. Motor companies - from listed groups to used-car dealers - are trying to clinch new Chinese franchises. And they have plenty to choose from - there are about 120 car-makers in China.

Mr Nicholas Ng, general manager of Group Exklusiv, which distributes Geely here, says: "Mark my words, 50 per cent of cars in Singapore in the future will be Chinese."

A bold forecast, but not entirely baseless. In the last five years, new vehicle sales in China have doubled to five million units per annum, making up 8 per cent of global sales.

The giddying pace at which Chinese manufacturers are growing is not only worrying established foreign car-makers. The Chinese government has started to restrict exports to more established players in a move to protect the reputation of China-made goods.

In Singapore, some quarters have taken their scepticism about the quality of Chinese cars to the authorities and the press.

An unflattering videoclip of a Chery QQ in a crash test did the rounds on online car forums last year. It was also on file-sharing website YouTube.

But the LTA assures that cars imported here are safe. A spokesman told LifeStyle that the China makes 'comply with our technical requirements'.

"The manufacturers have also certified that the vehicles and their components have been tested to comply with safety standards that are acceptable in Singapore before we approved their applications," she added.

Motor traders reckon China cars are here to stay as there will always be a demand for inexpensive, no-frills cars.

Mr Alvyn Ang, general manager at multi-brand agency Cycle & Carriage, says: "China cars are like the Koreans when they first came. They will improve."

He says the quality of these cars is adequate for a small urban environment such as Singapore's, where most journeys are short A-to-B commutes.

What about other concerns such as resale value and durability? Observers point out that in Singapore, many used cars are just scrapped. In such cases, owners recover the residual taxes of the vehicle. And for such cheap cars, annual depreciation is more manageable than more premium makes.

As for spare parts, LifeStyle understands that Chinese car parts are inexpensive (sometimes ridiculously so). For instance, an oil filter for a Geely CK is $3.40 - compared with $12 for an exact part for a Japanese car.

Mr Kevin Kwee, executive director of Group Exklusiv, puts it succinctly: "These cars are simple cars, like the cars we had 30 to 40 years ago. We can remove the engine and put it back on in less than 45 minutes. They can't be compared with the sophisticated models from the Japanese or Europeans."

Group Exklusiv has a tagline for Geely: The All-New People's Car. It is by no accident a reference to Volkswagen, touted in post-war Germany as "the people's car".

 
 
 
Copyright ©2007 Singapore Press Holdings Ltd. Co. Regn. No. 198402868E. All rights reserved.
Privacy Statement Conditions of Access Advertise