John Batchelor, host of the John Batchelor radio show, and Gordon Chang, Forbes, and Lou Ann Hammond, CEO, Driving the Nation talk about BYD and Tesla Motors, Volvo and corruption bribes in China.
BYD is a Chinese owned company, owned by the private entrepreneur Wang Chuanfu. Tesla is trying to break into the electric vehicle market in China. China heavily supports the creation and production of electric vehicles, but the electric vehicle was not the only reason that Warren Buffett bought 10% of BYD. BYD is creating energy storage systems that hold energy that can be used later, say, during peak hours of transmission between noon and 5 pm in the United States.
Volvo is a wholly owned subsidiary of Zhejiang Geely Holding Group of China, known as Geely. Historically Volvo has been known for safety and reliability, but there are other car companies that have caught up with them and some have surpassed them. What does the future look like for Volvo?
I also learned at the 2015 New York auto show that luxury goods, including vehicles, have not been doing well on the Chinese market. President Xi Jinping has been cracking down on corruption in China and that includes bribes given to officials. People in China are afraid to buy expensive items because they could be suspected of taking bribes. It has gotten so bad that the BBC just reported that the Macau luxury fair was canceled because of the anti-corruption probe.
Recently China and Japan got in a tussle over some small islands known as the Senkaku Islands in Japan, the Diaoyu in China. Nationalism became part of the dispute and Japanese car sales in China started going down. It wasn’t all Japanese cars those. Which companies saw the decline?