Beijing: When Ric Hull first looked at launching Great Wall Motor pickup trucks in Australia last year, he considered rebranding them, worried their obvious Chinese origins would raise questions about their quality.
Ateco Group, Hull's auto importing and dealership company, decided against marketing the low cost models under the "GWM" label, instead embracing the trucks' made in China credentials, and sales are booming.
"We initially thought: do we resolve the brand question, do we call them GWM? But then we thought that people would know anyway, and that seems to be working very well," Hull told Reuters at the Beijing Auto Show.
Chinese carmakers, some with the help of foreign partners, have rapidly improved vehicle quality as they prepare to take on established international brands such as Volkswagen, General Motors and Hyundai Motor in the higher segments of the market that they dominate in China.
With such improved quality and cut-rate prices, established automakers could one day be competing against China's most successful brands not only in China but on the global stage, executives said.
"I have no doubt about it," Nissan Motor CEO Carlos Ghosn told a small group of reporters at the Beijing auto show. "Some Chinese brands are going to gain credibility. They're going to be acquiring know-how, like the Volvo acquisition [by Geely Automobile]," he said.
Mitsubishi Motors President Osamu Masuko agreed, saying he was impressed when he recently test-drove BYD's F6 sedan.
"For a company that's only been in this business for a few years, it's remarkable," he said. "And they're going to keep improving with every model change. One day, Chinese automakers could be a formidable competitor."
Toyota Motor's R&D chief, Takeshi Uchiyamada, also said he saw big improvements in the interior and exterior packaging as he walked around the auto show.
Timeframe
Some analysts say that Chinese brands could become rivals outside their native market sooner than most automakers reckon.
"Chinese car companies are climbing the technology and quality ladder at such a pace that we believe within a few years, some domestic brands will able to compete with global brands both at home and overseas," Nomura International analyst Yankun Hou wrote in a recent report.
To be sure, managing quality is not only a Chinese issue.
The explosive growth in the China market has put major automakers on watch as well, especially after the global vehicle recalls that roiled Toyota earlier this year.
Established automakers are focusing on how to keep quality standards — and brand perception — from slipping even as they storm ahead with capacity expansion plans.
"The quality of the dealership is more important to me than the number," said Ford's global marketing chief, Jim Farley. "I want to make sure that we are getting the right partner for the next 50 years."
Chinese automakers, for their part, are aware of the task still ahead of them.
"We still have a gap to fill with international brands," Jianghuai Automobile Group President An Jin told an industry conference in Beijing last week.
"This will be the driving force for us. We need to enhance our brand and quality."
