Friday, July 29, 2011

Deeply Saddened

All of us at Kent Rylee Automotive Solutions are greatly saddened by the passing of our co-owner, Darrell Bone. We would like to sincerely thank the community for all your thoughts and prayers. We are certain Darrell would be deeply touched by your genuine outpouring of support. Darrell will be greatly missed by all of us. Memorial service information will be shared as soon as we have more details.

Thursday, July 28, 2011

US budget issues predicted in the 1970s

This post contains no business advice and is only tangentially related to China. You have been warned. :-)

Having recently read Daniel Bell's The Cultural Contradictions of Capitalism, I am reminded of how, back in the 1970s, Bell predicted the budget issues we are now enduring in the United States.
The fundamental political fact in the second half of the twentieth century has been the extension of state-directed economies. These developed first because of the need to rescue the system from depression, later because of the demands of a war economy and the enlargement of military commitments, and finally because of the strategic role of fiscal policy in affecting levels of spending and patterns of investment...

The new “class struggles” of the post-industrial society are less a matter of conflict between management and worker in the economic enterprise than the pull and tug of various organized segments to influence the state budget. Where state expenditure approximates 40 percent of Gross National Product, as it almost does in the United States … the chief political issues become the allocation of monies and the incidence of taxation.

… it is also likely that in the United States a state-directed economy and a state-managed society will please no one... Radicals are becoming increasingly suspicious of government … even though their first reaction to any issue is to call for more “government,” … And the state management that will emerge will be a cumbersome, bureaucratic monstrosity, wrenched in all directions by the clamor for subsidies and entitlements by various corporate and communal groups, yet gorging itself on increased governmental appropriations to become a Leviathan in its own right.
Oh, and did I mention that Bell was an admitted "socialist"? (If you watch Fox News, please don't let that word put you off just yet.)

By way of background, the most significant "contradiction of capitalism" that Bell identified was one between asceticism and acquisitiveness. The Protestant work ethic that Max Weber credited for turning work into a “calling” for Americans and implanting within us the idea that the work itself and the associated accumulation of capital were honorable pursuits, became (sometime during the 20th century) conflicted with the rise of consumer culture encouraged by the introduction of installment credit.

The resulting conflict has shifted the focus of American society 180 degrees from a focus on production to a focus on consumption. Whereas, according to Weber, Americans were all previously motivated by hard work and savings as the ultimate service to God and country, according to Bell, not only have God and country been supplanted by the individual, but we now all measure ourselves by how much we are able to consume.

In other words, employers demand of their workers a traditionally puritan level of commitment to work while urging their customers toward a hedonistic, anything goes, make-yourself-happy-and-screw-everyone-else lifestyle. The obvious problem here is that the workers and the consumers are the same group of people.

But I digress...

Back to Bell's quote above, if Bell was right, then we haven't even begun to see the worst of impending budget fights. Even if the two sides in Washington are able to reach a last minute deal this time, nothing will be done to solve the fundamental issues that have placed the budget front and center of American politics.

Think about it. Seemingly all discussions in Washington now revolve around spending and taxation. Rarely does the debate have anything to do with what sort of society we want to be.

I said above that this post would have little to do with China, but having written this far, I cannot help but wonder whether China's form of state capitalism might not also lead to similar contradictions.

Again quoting Bell:
In a modern [i.e. capitalist] society, the engine of appetite is the increased standard of living and the diversity of products that make up so much of the splendid color of life. But it is also, in its emphasis on display, a reckless squandering of resources... [If you're a China watcher, and this doesn't sound familiar, perhaps you haven't been to China in awhile.]

Where resources are prodigal, or individuals accept a high degree of inequality as normal or just, this consumption can be accommodated. But when everyone in society joins in the demand for more, expecting this as a matter of right, and resources are limited, ... then one begins to see the basis for the tension between the demands in the polity and the limitations set by the economy.
Bell says this results in five elements that are "structurally transforming the old market system":
  1. institutionalized expectations of economic growth and a rising standard of living.
  2. the incompatibility of various wants and diverse values
  3. enormous spillover effects from economic growth (e.g. environmental effects)
  4. a worldwide inflation -- "the largely inescapable consequence of a commitment to economic growth and full employment"
  5. crucial decisions about the economy are no longer left to the market, but become political questions.
When Bell wrote all of this in the mid-1970s, he wasn't really thinking of China (how could anyone have predicted what China would become?), but his descriptions of problems that would soon afflict the US now also seem to apply to China.

While conventional wisdom tells us that China's leaders are probably patting themselves on the back for rejecting democracy and its besetting partisan difficulties, does Bell's warning indicate that China may also be running headlong into a similar set of problems?

Wednesday, July 27, 2011

Thailand: Auto output seen reaching 2 million in 2012

Automotive production in Thailand is expected to reach approximately two million units in 2012, up from around 1.8 million units this year. The Thai Automotive Industry Association (TAIA) projected this figure, and attributed the increase in output to high domestic and overseas demand.

Thailand's Auto Production To Reach 2 Million Units In 2012

Sounds good...

Monday, July 25, 2011

PATTAYA MAIL: TAI keeps faith in auto biz in 2011

Thailand’s automotive industry is expected to revive strongly in the latter half of 2011 after receiving serious impacts from the devastation of a powerful earthquake and tsunami in Japan in March.

Saturday, July 23, 2011

AFG Meeting: Hemaraj Technical College Presentation

This Tuesday more than 40 members and associates participated at the AFG Meeting held at the Conference Center at ESIE Plaza I, Hemaraj Eastern Seaboard Industrial Estate.

The presentation focussed on the status and future of education of Thai workers – and a significant gap between the industry requirements and the available human resource.

As a response, Hemaraj plans to set up a Technical College based partly on the German apprentice system to offer technical education to Thai workers.

This excellent presentation by Khun Preeprem Malasitt, Special Project Director at Hemaraj about the Hemaraj Technical College Project is now online and ready for download.

Friday, July 8, 2011

The Future of the Thai Auto Industry

Thailand's auto industry is targeting production of 3 million vehicles annually by 2015, pushing the country into the top 10 from its present 12th ranking.

Atchaka Sibunruang, secretary-general of the Board of Investment (BoI), last Thursday said automobiles are a core local industry, as evidenced by the 1.65 million vehicles produced last year.

Monday, July 4, 2011

CHINA DAILY: Japan taps Indonesia as car production base

And China will also be 'tapping' in very soon I guess...

JAKARTA - Indonesia's improving investment climate and high automobile sales led two major Japanese car makers, Daihatsu and Suzuki, to name the country their production base for global and regional markets, local media reported here on Wednesday.

Industry Minister MS Hidayat announced on Tuesday that Daihatsu would hold a ground-breaking ceremony on May 20 to mark the beginning of the construction of its new production facility in Karawang, West Java.

"The investment value for the factory is 2.1 trillion rupiah ( about $245 million)," he said at his office here.

Private sector wishes for stability

The local and foreign business communities hope the country can finally get back on track with political stability, economic expansion and fairer competition under a new government.

"Thailand should move forward and concentrate more on promoting economic growth after the country had been falling behind others because of the political conflict," Nandor von der Luehe, chairman of the Joint Foreign Chambers of Commerce, said yesterday.

Thailand's appeal strong despite challenges

Thailand's new government should look at improving the country's already good infrastructure to make it difficult to resist for foreign investors, most of whom continue to have a positive long-term outlook despite political ups and downs.

"What is needed is the development of infrastructure and long-term planning," said Peter Eliot, head of the American Chamber of Commerce in Thailand and the country head of Citibank.

JAKARTA GLOBE: Indonesia’s Growth Potential Putting Automakers in Gear

Indonesia’s automotive sector is experiencing a surge of investment that could take it back to its glory days in the 1990s, and possibly even overtake Thailand as the Detroit of Southeast Asia.

Johnny Darmawan, president director of Toyota Astra Motor, said that with the country’s strong economic growth, young population and availability of resources, it was inevitable the company would step up its investment plans here.

THE STAR MALAYSIA: Drop in June car sales

PETALING JAYA: The amendments to the Hire-Purchase Act 1967 (HPA) that took effect on June 15 has caused delays in vehicle registrations and should result in lower total industry sales for the month.

Car players said the drop did not mean people were buying fewer cars but reflected the longer time to book a sale and they expect the registration numbers to smoothen out in July.