China pushes its economic leverage

Chinese woman working on laptop

The rise of China and its impact on economies all over the world isn’t a new story, but this overview in the New York Times is worth reading. The tone is one of looking at the downside of China’s economic empire and the unwillingness of desperate partners like European nations to assert themselves. But there is an upside, as China can provide much needed capital to struggling countries, and this also gives China a huge stake in stability around the world. There are certainly concerns on issues like the environment and human rights, but one needs to look at the big picture as well. Fortunately, President Obama’s foreign policy is aimed at engaging but also containing China, and he has been willing to use our own leverage in this relationship.

More Apple audits in China

Apple is ramping up audits of factories in China.

Apple has told a prominent Chinese environmental activist that it will soon launch independent environmental audits of at least two suppliers’ factories in China, the activist said.

The audits come as Apple faces mounting criticism about toxic pollution and factory injuries at overseas suppliers’ factories. The environmental reviews would be separate from an independent probe of working conditions at the China factories of Apple suppliers, including Foxconn Technology, that began last week.

Ma Jun, founder of The Institute of Environmental and Public Affairs, told USA TODAY Monday in a phone interview that Apple agreed to the independent audits in late January in response to two reports that IPE and other environmental groups released last year documenting hazardous waste leaks and the use of toxic chemicals at suspected Apple suppliers.

Apple’s image has taken a beating with the problems at Foxconn, so let’s see if this is a new trend.

U.S. should increase Chinese tourism

Tom Friedman writes often about China, and his latest column addresses current hot issues like currency valuation, manufacturing and trade. But this paragraph grabbed my attention:

But we also need to stop thinking that a middle class can be sustained only by factory jobs. Thirty years ago, Hong Kong was a manufacturing center. Now its economy is 97 percent services. It has adjusted so well that this year the Hong Kong government is giving a bonus of $775 to each of its residents. One reason is that Hong Kong has transformed itself into a huge tourist center that last year received 36 million visitors — 23 million from China. Their hotel stays, dining and jewelry purchases are driving prosperity here. The U.S. Commerce Department says 801,000 Mainland Chinese visited the U.S. last year, adding $5 billion to the U.S. economy. More Chinese want to come, but, for security reasons, visas are hard to obtain. If we let in as many Chinese tourists as Hong Kong, it would inject more than $115 billion into what is a highly unionized U.S. hotel, restaurant, gaming and tourism industry.

The United States needs to get beyond some of the over-zealous security restrictions imposed after 9/11 and let as many Chinese and other tourists come visit as possible. Tourism has helped to sustain Europe for years, and the U.S. needs to take advantage of this as well.

BYD Announces EV Fleet Results at Anniversary of Green-Taxi Project

Chinese automaker BYD just reached an epic milestone for the company. The company’s vehicles have been part of an electric taxi initiative known as the Green-Taxi Project, operating full electric vehicles in Shenzen for an entire year. As of April 29th, the fleet has reached a total of 2.77 million kilometers driven with an estimated fuel savings of $1167 per month, per taxi.

From the press release:

In total, BYD EVs have accumulated over 1.769 million all-electric miles and have seen no diminished range or capacity due to rapid-charging. BYD vehicles are estimated to have already saved $360,000 in fuel costs and over 2.776 million lbs of carbon-dioxide. BYD launched consumer sales of the F3DM in September 2010 and anticipates very good demand for the BYD e6 and all electric vehicles in China, fueled in part by government incentives for the purchase of electric vehicles.

This is big news as China continues to work toward a more balanced national carbon footprint. For more about the BYD initiative, check out the official press release.

Ford might be too far behind to catch up in China

Ford Focus China.

Despite Ford’s proclamation that it is rapidly expanding in China, the company seems to falter when it comes to actually getting the job done. The most recent JD Power Sales Rankings show Ford at number 14 in China, way behind, well, everyone else. In the first two months of 2011 the company sold just 51,170 cars, while brands like Volkswagen and Hyundai sold 276,137 and 129,430 models, respectively. That’s a big gap to overcome, and unfortunately we probably won’t be seeing much progress this year.

Chinese production of the Ford Focus doesn’t start until 2012. An initial flight of 150,000 units is meant to help Ford catch rival manufacturers, but will it be too late? All signs point to yes. If Ford is already at a quarter of the sales of other major players, it doesn’t look good for the company to play catch up.

As The Truth About Cars has it:

Ford is a late-comer in China. It started in 2003, building some 20,000 Fiestas from kits. In 2006, Mazda joined the fray for a threesome. Like most threesomes, it didn’t work out. After Ford and Mazda disengaged in Japan, Ford and Mazda parted ways in China and started their own joint ventures – both with Changan. The separation is not finished yet and won’t be finished until the Chongqing plant will be operational in 2012. All this does not help.

You can’t say it any better than that.

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