Aug. 27.
In the correspondence columns ily News" on August 14 "Wayfarer" called attention to the position of the British motor car in the China market. The point taken that no serious effort had been made to sell British cars here, and the writer put forward the suggestion that, in view of: the variety, cheapness and reliability of the cars seen in England today, this matter should be taken up "by the Economic Mission which is shortly to visit the Far East. Incidentally the latter point has already been suggested at Home, which is all to the good, but to say that no serious effort has been made to sell British cars here seems to be doing less than justice to local salesmen. It would probably be more correct to say that the-policy of the British motor industry vis-a-vis of that of other countries—the United States in particular—is such as to stultify the best efforts made locally, and if the Economic Mission can effect a change at Home it will be doing a service to British trade. China, it must be" recognized, is a growing market in respect of motors. Whereas a couple of years <go sixty-five per cent. of car purchases in Shanghai were on the part of the foreign population, this year the proportion has so far changed that seventy per cent. of the buyers are Chinese, and perhaps an equally important feature is that the truck chassis is becoming as large-a factor in the business as the car, possibly even larger. The statement is made that these are being purchased in fleets of a hundred at a time for omnibus and freight service in the interior. A market whose potentialities seem as unlimited as this obviously cannot be ignored.
To arrive at the reason for the present popularity of the jean product as against the it is only necessary to look at local conditions and tendencies, especially among the Chinese who are now the largest purchasers. One of the fi factors is that the majority of car owners in Shanghai have chauffeurs, and on that account the American car is usually preferred because of its larger siz. The cars cited in "Wayfarer's letter were all medium-sized or small, and in selecting a car the buyer naturally looks to see that he is not going to be cramped. Now, when it comes to a British car of the same seating capacity asthe American the differenc> in price is so marked that the British article practically stands no chance. One such British car which arrived in Shangh: recently could hardly be sold at less than Tls. 7,000, whereas aa American six-cylinder product of practically the same size costs about half the price. Facts such as these cannot be ignored, and in a place such as Shanghai it is no use preaching the gospel of the reliability and lasting qualities of British goods as against others, and showing that they come cheaper in the long run, for while this is undoubtedly true in other classes of goods, cars here change hands so fr2- quently and newer and more attractive models are so constantly coming on the market, hi that the argument hardly interests the potential buyer. The seriousness of the problem must be realized by the British manufacturer if he is to make he way. He must recognize tha: freights are cheaper from America than from England, and therefore the initial cost of the car he wishes to sell here must be lower. The credit the British manufacturer is prepared to give is generally less than his American competitor's, and he has further to consider the case that probably a certain amount of dumping of cars, to fetch within certain limits whatever they may, is a factor in the situation, Where in competition wita others the British manufacturer is at an enormous disadvantage that his cars are too specialized, if that is the correct word to use. It is all very well in England to have innumerable types of cars, all with their particular individuality, for if any repairs have to be done, spare parts can be obtained from the factory within twenty four hours. Obviously, however, dealers out here cannot stock spare parts for a large variety of cats on account of the enormous interest charges which would have to be met, and so if anything goes wrong one of these cars may be out of commission for weeks. The policy of mass production and concentration on a certain number of models adopted by the American manufacturers prac tically eliminates this back, and accordingly they at once' possess an advantage in market such as this. Further in many cases the actual produce: of the American car does lift! more than assemble the parts which have been made for him by firms specializing in different types of machinery, and ea account of their mass production these firms in turn become the purveyors of spare parts to dealers throughout the world. The system enables them to sell these at a cost generally below, what the European manufacturer can contemplate. Obviously tha only way in which the Britisa motor industry is to be able to compete with the American la foreign countries is to adapt ite self to a new set of conditions.
It is quite true that progress has already been made in that direction, but it has not gone far enough yet. The attention of that Economic Mission has already been drawn at Home to the need for promoting the motor industry in the Far East, and may be hoped that its investis: tions, which will inevitably force it to the conclusions summarized here, will be impressed on the leaders of the indust:
Text read from the printed page and cleaned; old type leaves the occasional error.