Export ban lifted...HoorayBooming China eyes off potential local...

Export ban lifted...Hooray


Booming China eyes off potential local car assets

Read more: http://www.theage.com.au/business/booming-china-eyes-off-potential-local-car-assets-20110706-1h2gh.html#ixzz1RMkOJJhX

CHINESE buyers would snap up the car-making assets of Ford Australia or Holden if their US parents abandoned their Australian operations, an automotive industry analyst says.

Treasury Asia Asset Management investment analyst Tan Eng Teck said there were already cashed-up Chinese investors casting about the edges of the Australian car-making industry as the fast-moving industrial giant attempts to ramp up its domestic production.

''For car parts, they are looking at direct takeovers, but for other things they're generally looking for joint ventures. But if it is for internal parts, they will prefer a direct takeover,'' Mr Tan said.

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Chinese money has already flowed into the Australian car components industry, with car maker Geely picking up the assets of struggling gearbox maker DSI in 2009. Since the takeover, Geely has started to build gearboxes in China using intellectual property acquired from DSI - a fact not lost on Mr Tan. ''The Chinese don't respect intellectual rights that well. The Chinese are more about practicalities - why spend five years developing it when you can just go out and get it?''

Mr Tan said Chinese investors would also cast around for more car makers showing signs of trouble - the formerly Ford-owned Volvo has already fallen into Chinese ownership, with the once GM-owned Swedish brand Saab now facing a reverse takeover by Chinese car distribution business Pang Da - in the hope that it could snap up the assets cheaply. Ford, Holden and Toyota have all warned that they could abandon car-making operations in Australia after the federal government earlier this year dumped its $1.3 billion Green Car Innovation Fund just over two years into the fund's 10-year timeline.

Holden chief executive Mike Devereux warned that the government's move - designed to help pay for a string of natural disasters in Queensland and Victoria - threatened the future of the car maker's viability.

''It's actually scary for a lot of [international car makers],'' he said.

''A lot of governments actually impose rules that say [Chinese investors] can't take this technology outside the country when they acquire it - Sweden did it with Volvo. But the Chinese will take it anyway.''


Read more: http://www.theage.com.au/business/booming-china-eyes-off-potential-local-car-assets-20110706-1h2gh.html#ixzz1RMkol6m4