Sunday, March 25, 2012

Thai-made Mitsubishi Mirage to be sold globally

Mitsubishi Motors Corp (MMC) president Osamu Masuko said on Tuesday that the firm would soon start manufacturing the Mitsubishi Mirage at a factory in Thailand to meet both local and global demand.

Calling the Mirage a 'global compact car', Mr Masuko said during a Bangkok press conference the Mirage would fit the needs of both mature and emerging markets.

Friday, March 23, 2012

Time for a Shakeout in China's Auto Industry?

Yesterday China Bureau Chief of Automotive News, Yang Jian posted an interesting article (free registration reqd.) speculating as to possible consequences of a recent slowdown in auto sales in China.  In the first two months of 2012, auto sales decreased four percent, year-on-year – and this comes on the heels of (for China) a rather anemic 2011 in which sales only grew about 2.5% and Chinese-branded passenger vehicles gave up nearly two percentage points in market share to the foreign brands.

In short, Yang Jian's point is that, should this drop in sales become a trend that lasts through 2012, some of the weaker players in China's auto industry could be forced into bankruptcy or possibly out of business altogether.

From the perspective of China's central government, which has been begging and pleading for this heavily fragmented industry to consolidate itself for nearly three decades, this wouldn't be such a bad thing.  (Of course it would be a bad thing for the employees of those companies that went out of business.)  There are still well over 100 vehicle manufacturers operating in China (compared to only 24 in the United States), and this fragmentation prevents the industry as a whole from becoming more competitive vis-à-vis
the foreign automakers.

So what is the likelihood that a decline in sales could lead to a shakeout of the weaker players?  Well, let's take a look at what happened the last time China's auto industry experienced a slowdown in sales growth.  After enjoying annual sales growth of anywhere between 14% and 37% since 2001, the onset of the Great Recession in 2008 caused China's growth rate to drop to a horrifyingly low 7%.  (Yes, the word “horrifyingly” should be interpreted sarcastically.)

I remember talking to a lot of auto industry insiders in China in the spring of 2009 when some of them lamented the fact that the much hoped-for shakeout didn't happen back then.  (And it seems like Yang Jian himself may have been among those who expressed such sentiment to me then.)

Why didn't the shakeout happen?  

The central government rode to the rescue with a far-reaching stimulus program that not only prevented another year of miserably low sales growth, but that, for the first time ever, launched China into position as the world's single largest market for automobiles in 2009.  Hence the lamentations from some of my interviewees at the time.  As Yang Jian hopes today, many of them also hoped soft sales growth would kill off some of the weaker players in 2009.

So will the central government ride to the rescue again this year? 

I think it is less likely.  With large cities in China already limiting the number of cars that can be sold and driven on their streets, and with the central government clamping down on overcapacity in the industry, AND now that China is already the number one auto market in the world (they can't go any higher), a rescue is probably not in the cards.

Does that mean a shakeout will occur? 

I wouldn't bet on that either.  Among the top-10 automakers, Chang'an, Chery and BYD each experienced sales declines in 2011, which doesn't look good for them.  Except that Chang'an is among China's “Big 4” and Chery is among China's “Small 4.”  What this means is that the central government has designated these automakers to be among those remaining after the industry consolidates.  And BYD is privately-owned (its shares are traded in Hong Kong), and, though it hasn't sold as many EVs and hybrids as it had hoped to by now, it is probably China's best chance of having an automaker who can compete in this space.

Will a shakeout then occur among the dozens of tiny, inefficient and unprofitable automakers scattered around the country? 

I think this is the best hope, but whether the downturn will be deep enough and long enough to outlast local governments' ability to prop up these firms remains to be seen.  Local governments tend to be rather fond of their automakers -- even the ones that lose money.


SAH Leland Chapter Members & friends,
Join us and see rare and unique automobiles, 150 vehicles that make up one of the greatest car collections in the United States.

7819 Lochlin Drive
Brighton, MI 48116
Saturday, April 28, 2012, 11am - 3pm
$10/per person (includes Tour, Lunch, Presentation)
RSVP by April 21, 2012 to Victoria
586.246.0312 or email:

John Jos. Jendza III/Top Hat John … Director
Jim Petersen   …………… Associate Director
Victoria Mobley ………   Secretary/Treasurer

The Lingenfelter Collection
There are more than 150 vehicles in a 40,000 square foot space. Vehicles are from the early 1950’s through the 21st century, Corvettes, Ford, muscle cars and more. Several vehicles in the collection are among the most rare automobiles in the world, including a Bugatti Veyron, an Enzo Ferrari, and a Lamborghini Reventon.

Will Thailand enter the TOP 10 in 2012?

Sounds ambitious…but if you look at the 2011 statistics, you will see that the 2012 projected production number of 2,100,000 vehicles will bring us about almost right there – or at least very very close. My personal opinion: We will make it by 2013.

Thursday, March 22, 2012

February vehicle production improves

Total vehicle output increased by 11.6% year-on-year last month to 168,221 units after all carmakers except Honda recovered from the floods of 2011.

Malaysia: Volkswagen, DRB-HICOM officially start vehicle output

Volkswagen Group Malaysia and local partner DRB-HICOM have officially started assembly of the Passat from SKD kits in Pekan.

The partners also laid the foundation stone for a new production hall at the plant site. In a second stage, the Jetta and Polo will be produced - from CKD kits.

Tuesday, March 20, 2012

Andrew Hupert's "Guanxi for the Busy American"

My friend Andrew Hupert, whom I first met in Shanghai several years ago, has for years managed a couple of very practical and helpful blogs on negotiating and managing in China ( and  Even before I met Andrew, I always wondered why he would give away such valuable information for free.

Well, now he's finally selling part of his wisdom in an e-book entitled Guanxi for the Busy American available at Smashwords in ten different formats including Kindle, ePub and PDF.  And at a price of only $2.99, it's a bit of a steal.  (Seriously, Andrew, you should charge more.)

Because it's in an e-format, it's easy to keep on pretty much any device and peruse on the plane on the way to China.  And whether someone is completely new to China, or an old China hand, the book is equally useful as both a source of necessary learning, or a reminder of how things work in China.

Much of this stuff simply doesn't come naturally to Westerners, and, even after nearly 20 years of travel to China, I occasionally need reminders.  The book is a relatively quick and easy read -- it took me a little over an hour -- but it's packed with both theory and practice on what this mysterious guanxi thing is all about and how to navigate one's way through a potentially tricky maze of gestures and obligations.

Andrew's writing style is clean and straightforward, but also descriptive and, at times, humorous.  Among the gems are statements like "Guanxi is the sweet candy shell that coats some potentially bitter medicine."  What he explains is that, while the whole process of building guanxi can seem light and even fun, it is a process that the Chinese take very seriously.  Mistakes made during this process can sink a partnership before it even gets off the ground.

Among the behaviors he warns against are denigrating the value of guanxi among your Chinese hosts by saying something like, "oh yeah, we have that concept in America too: it's not what you know but who you know," which is likely to be taken as an insult.  Your Chinese hosts will be more flattered if you simply admit that the whole concept baffles you and that America has nothing like it.  Even if that isn't true (and if you've read this book, it won't be true) it will buy you some credit with your hosts.  (I mention this particular bit of advice because I know I have violated it several times in the past.)

The book also offers a way to "de-code" some of the guanxi talk you are likely to hear at an early guanxi-building session with your hosts.
When they ask if you have been to China before, they want to know if you already have connections or are likely to grant them exclusive control (over your venture).
And another 
When they ask when you are returning to America, they want to know about your internal deadlines so they can time the negotiations to apply maximum pressure.
He also offers practical advice on how to deal with endless toasts and offers of cigarettes during banquets.  These are important rituals that tell the Chinese something about you.  More importantly, how they react to your behavior also tells you something about what kind of partner they would be.

One final point (among many dozens more) is that foreigners in China need to understand that their hosts generally want very much to invest in a long term relationship.  But one shouldn't be fooled into thinking that a relationship that begins well will result in an eternal bond.  The Chinese simply do not see it that way.  The relationship will only last as long as the Chinese partner thinks he is deriving value equal to or greater than yours.  Once that calculation changes, expect a re-negotiation.  And if you aren't open to re-negotiation, expect your counterpart who has invested time in learning the names of your spouse, children and pets to lose interest and stop returning your calls. 

The only real criticism I can think of is regarding the title.  I am not so sure that North American and Western European cultures are so different that this book wouldn't be immediately useful on both sides of the Atlantic (and down under as well).  Perhaps it might have been better titled Guanxi for the Busy Westerner.

Either way, people who do business in China need to load this book onto their Kindles and iPads.  And if you find yourself sending a newbie to China on behalf of your company, be sure he or she has this book ahead of time.  They will need to read it several times before getting on the plane, and probably several more while they are in China.

Bangkok Post: The big leap

Interesting feature about Continental Thailand and portrait of Dirk Janovsky, MD:

"Our biggest automobile client is the AutoAlliance Thailand plant. Continental components are used in the Ford Ranger, Mazda BT-50, Nissan March and Ford Fiesta,"said Janovsky, who holds a PhD in Mechanical Engineering from the  Institute of Production Technology and Machine Tools, the University of Darmstadt.

Janovsky will be overseeing an additional 600 million baht investment at the plant which he described as "a higher depth of manufacturing and a machining line for the production of injector bodies", which will be channelled to export markets such as India, Europe and  Argentina.

Continental Automotive's current localisation of sourced components is 40%, a rate which is targeted to increase to about 60% by 2016.

Monday, March 19, 2012

Book Talk at USC

Several weeks ago I gave a talk related to my forthcoming book at the University of Southern California.  Watch as I attempt to summarize four years of research and a 300-page book in less than an hour.  :)

Sunday, March 18, 2012

Friday, March 16, 2012

Myanmar Presentation by UMFCC

All you want to know about Myanmar – a very nice presentation by the Union of Myanmar Federation of Chambers of Commerce….

Click here to download (8 MB PDF - 69 Pages about economy and investment / business opportunity).

Thursday, March 15, 2012

Bangkok Post: Thai Summit capacity gets B9bn turbo boost

Thai Summit Group, one of the country's largest auto parts makers, will spend 9 billion baht to expand capacity at home and abroad this year in a bid to cash in on steady growth in vehicle production in Southeast Asia and China.

With a presence in China, Japan, the US and India, as well as Thailand, Thai Summit expects revenue of 60 billion baht this year, up by 20% from last year.

Auto industry staging major rebound

The local automobile industry is expected to experience a boom this year, said Piangjai Kaewsuwan, president of the Thai Automotive Industry Association.

Record output at or above 2.1 million units in 2012 is anticipated.

In the domestic market, sales of 1.1 million vehicles are expected, while exports of Thai-built vehicles are seen hitting 1 million units.

Wednesday, March 14, 2012

Top 10 in carmaking within sight

The Industry Ministry is confident that automobile production will reach 2.1 million units this year and is predicting the country will be one of the top 10 producers of cars in the world.

"The automotive industry is our core industry, generating 360 billion baht of exports a year and employing 350,000 workers. It's clear that government policy will support Thailand in becoming the top producer in Asean and one of the top 10 in the world," said Industry Minister M.R. Pongsvas Svasti.

Monday, March 12, 2012

The Ins and Outs of Serpentine Belt Replacement

Today’s Kent Rylee Automotive blog article focuses on your serpentine belt. Your serpentine belt is a long belt that’s driven by your engine. It winds around several accessories that power important automotive systems. Let’s go over them.
First, the serpentine belt drives your air conditioning system. Next, the belt powers the alternator.
The serpentine belt may also run the pumps for both the power steering and power brakes. In some family cars, power steering may have an electric drive and power brakes can be vacuum driven.
And, on many vehicles, the serpentine belt powers the water pump (on some cars, the water pump is powered by the timing belt).
Your service technician can perform a visual inspection of the belt to see if it has any cracks that signal the belt could fail soon and will measure the amount of belt material to make sure there is enough.
Drivers should be aware that there’s a special, spring loaded pulley attached to the engine called the tensioner pulley and sometimes an extra pulley call the idler pulley. Their job is to make sure there’s a constant tension on the serpentine belt so that it doesn’t slip. The spring can become worn and no longer provide the necessary pressure to keep the belt tight. That’s why it’s often recommended that the tensioner, and the idler pulley if so equipped, be replaced at the same time as the serpentine belt.
All in all, the serpentine belt’s an important part for the function of your family car. And it’s not that expensive to replace at Kent Rylee Automotive Solutions– so it’s good to do so before it fails.
At Kent Rylee Automotive in Rogers AR we install quality NAPA replacement parts. Give us a call at 479.636.3333. To learn more about Kent Rylee Automotive Solutions go to  To see a video that easily explains serpentine belt replacement go to

Thursday, March 8, 2012

Real World Application of Smartphone Apps

Real World Application of Smartphone AppsIt is clear that smartphones have taken the world by storm due to the vast technology advancement characterizing the modern world. These devices combine functions of computers and traditional mobile phones to offer users an entirely new experience. The most recent smartphones have taken the shape of tablet PCs. Some time back, these devices were extremely expensive, and only a few people had them.

Today, they have transformed from costly extravagant gadgets to a must-have. Industry statistics show that the number of people using smartphones is now at 60% and rising. Predictions show that by the year 2015, 90% of mobile users in developed countries will have a smartphone.

Types of apps developed

Due to the popularity of smartphones, software developers have emerged with ideas for app development for both everyday use and business. These smartphone apps have a variety of life application including money and financial management, management solutions and business planning, blogging and networking, advertisement, multimedia file sharing, GPS applications, leisure and entertainment, and educational purposes. Some of the most common applications of this nature are android business app and iPhone business app. Large and small companies can use these devices to link up with their clients to provide information and offer their services and products.

Development tools & Challenges

Currently, mobile app developers and software development companies have all the vital development tools to build top of the line smartphone solutions and offer users a rich mobile experience. With the constant growth of smartphone app market, it has now become normal business practice particularly for consumer goods, the media, food companies and automotive companies to build their own mobile applications to reach the public and clients in a new, fresh way. Both developers and publishers who focus on mobile app development come across various challenges including:

Reach fragmentation- Since market fragmentation is increasing, it is no longer enough for the mobile applications to adapt to one platform. To reach a wide target as possible, companies should consider multi-platform development. The companies should also settle on what platforms to begin with and how many to develop.

High cost- Development of smartphone is costly especially those that involve complex designs and procedures. Companies should consider developing the apps in-house rather than outsourcing to reduce cost and to better oversea the project.

Unmeasured risk- Most middle-sized or small companies have never published an application before hence do not have any idea of what the challenges might be like. It is logical then that these companies opt for ready-made solutions that have already been tested on the market. Developing just a simple smartphone app can take several months while complex and multi-platform apps can even take a year. The process is even slower when performed by developers from emerging markets.

Wednesday, March 7, 2012

Thai auto parts industry to hire 40,000 more employees

Via NNT:

BANGKOK, 7 March 2012 (NNT) – The Thai auto parts industry is looking to employ more workers in order to meet the automobile industry's production target this year.

President of the Thai Autoparts Manufacturers Association Achana Limpaitoon has announced that the Thai auto parts industry is planning to hire 30,000-40,000 more employees in addition to its current staff of 450,000 as it aims to accommodate the automobile manufacturers' goal to produce 2-2.1 million cars in 2012. In order to achieve the goal, the auto part makers must raise their production capacity by 30-40% from the previous year; thus, the sector needs to increase its workforce. 

Time For a Change, Oil Change That Is

Time For a Change, Oil Change That IsOil is an extremely complex fluid. Did you know that automotive engine oil contains well over 100 different elements and compounds? Whether synthetic or mineral, engine oil contains "base" oil. Additive packages are mixed in to that base oil produce the characteristics that auto manufacturers need.

Some additives increase the viscosity range of the oil, producing multi-viscosity oils like 5w-20, 0w-30, etc. Other additives reduce internal engine friction while still others clean up sludge and varnish. The additives and the base oils act in concert to keep your engine clean and well lubricated. If the oil in your car is left in too long it can begin to lose its ability to lubricate properly and excessive engine wear begins to occur. Engine oil is literally the life blood of your car.

How long is too long? It varies by type of engine, climate and usage of your vehicle. Turbochargers are cooled and lubricated with engine oil and turbos run very hot. This extra heat shortens the life of your oil. High revving performance engines put added strain on the oil and affect the oil's life. If you live in a hot climate your engine runs hotter and the oil does too, again shortening its life expectancy. If you tow with your vehicle or drive a lot in stop and go traffic, your oil is being stressed harder.

Whether you use synthetic or mineral oil is the most important factor. Mineral oil is cheaper than synthetic oil, but it begins to break down at a much lower temperature than synthetics do and is much more prone to leaving sludge and varnish behind in your engine.

A good rule of thumb is never go over 3,000 miles with mineral oil and follow your manufacturer's recommendation for synthetic oil change interval. But check to see if your manufacturer has two different recommendations. They often have one for "Normal" use and a different, more frequent schedule for "Severe" use. Severe means any of the conditions discussed in the paragraph above.

My wife recently picked up a new car, an Infinity G37 that she absolutely loves. I like it too for that matter. The dealer told us about their Infinity Express Service that they offer when an oil change is needed so we decided to try it out for the first oil change.

Wow, the world has come a long way from when I was a kid and my dad would get the oil changed at the gas station on the corner. We were greeted at the Infinity dealer's service drive right away. The car was whisked off for service while we went to a very modern customer lounge. Free coffee and tea, a big plasma TV on the wall, everything was very clean with not a hint of grease or dirt. There was free WiFi and comfortable chairs and a sofa.

While I surfed the net on my iPad and my wife watched a news show on the TV, factory-trained, certified Infiniti technicians conducted a full multi-point inspection of our car. This included tire pressures and treads depth, visual inspection under the hood and under the car, all exterior lights, the brakes were inspected and they even tested the battery condition with a computerized tool. They then changed the oil putting in the original factory recommended synthetic oil and replaced the oil filter with a genuine Infiniti filter.

When the car was done with its service, they even washed the car for us! In less than an hour after our arrival, we were ready to go with a fully inspected, serviced and freshly washed car. And you know what? The cost was low, my dad wouldn't have flinched at the bill if he'd been there. Infiniti Express Service is competitive with any oil change place you may know.

Monday, March 5, 2012

Mandrel Tube Bending: Type and Uses

In this modern world, no one can survive without the basic necessities such as food, shelter and clothing. Transportation, communication and some gadgets can be purchased if a person has excess money to spend. Beyond these commodities is the manufacturing and building part of expenses. Metals are the primary components of any industry. With this demand, there are different types of metal fabrication present such as sheet rolling, metal bending and pipe bending. The most used type of metal fabrication is pipe bends. One type of process that a pipe bender does is a mandrel tube bending procedure.

What is mandrel tube bending? First of all, mandrel bending is somewhat a misunderstood term. Many customers or clients and even some bending companies refer to the bending dies shoes as mandrels. On the technical side of things, the mandrel is a part of the tooling set but doesn't exist in most pipe bending applications. The mandrel goes inside the tube where it is held by a mandrel rod that supports the tube at the tangent point of the bend. A mandrel can be a linked ball or a steel rod inserted into the tube. The mandrel used will depend on the type of bend or application needed, radius required, wall thickness and the type of material being bent. The mandrel gives support to the tube to prevent as well as reduce wrinkling and breaking while in the process of bending. The mandrel is extracted after completing the bend. The different types of mandrel that are commonly used are:

· Ball mandrel with cable - usually used for critical and precise bends. It has linked ball bearings inserted into the tube.

· Ball mandrel without cable - these are unlinked steel ball bearings inserted into the tube. It is also used for precise and critical bends.

· Sand - sand packed into the tube.

· Plug mandrel - it is a solid rod used on normal bends.

· Form mandrel - it is a solid rod with curved ends. It is used on bends wherein more support is needed.

This type of pipe bend can create a tighter bend than empty bending and can create an even circumference. The end results are consistent and clean. The pipe bender can produce radii as tight as one times the diameter of the tube. Mandrel tube bending is useful for automotive and motorcycle applications, motorcycle chassis, hand railings, crash barriers, fencing, industrial shelving and medical products. It may also be used when fluid and gas is being flowed through a series of tubes. The use of pipe bend application does not stop here, there some metal bending companies that offer products for mining and resource such as safety barriers, machinery guarding and handrails; oil and gas companies that needs hydraulic tubing. Some manufacturers also offer mandrel tube bending for steel furniture such as chairs. Most steel chair frames are formed using crush bending. This technique weakens the frame and leaves unattractive indentations. It may not be as fast as crush bending but the results are far more superior and aesthetically pleasing. Moreover, the bend maintains the integrity of the steel tubing.