July 31st, 2008
And speaking of China, I find that country’s development fascinating. As it turns out, once a blueprint for a consumer culture (the U.S.) exists, it won’t take China nearly as long as it took this country to develop. In fact, wages have been rising there so steadily that companies are already looking for cheaper elsewhere, in Cambodia and Vietnam. And if the U.S. economy gets too much weaker, we’ll probably pass China, as they move from a largely agrarian society to a consumer-based one and the U.S. stumbles along. These days, U.S. consumers just don’t have the buying power to maintain a consumer-based economy. It’s ironic, to say the least.
July 31st, 2008
General Motors Corp. is in talks with “several” interested buyers for its Hummer brand, which the automaker can’t seem to get rid of fast enough. The latest word is that India’s Mahindra & Mahindra Ltd. is leading the pack, but I’d put my money on Tata Motors Ltd., which just spent more than $2 billion to acquire Jaguar and Land Rover from Ford Motor Co. and is making noises that it isn’t done with it’s acquisitions yet. A couple of Chinese automakers may also be contenders.
The question is why. India and China automakers are probably the only ones who can see any light these days — domestic and European automakers have already come to grips with bathing in red ink until at least 2010, maybe 2012. But will the market support such a behemoth vehicle? There are probably some buyers in India and China, but that’s only the law of averages. The two countries account for nearly 2.5 billion of the 6 billion people now populating the planet — but two thirds of them live in poverty so deep there is little hope of climbing out during their lifetime.
It will be interesting to see what either Mahindra or Tata, once tiny players beneath the attention of U.S. automakers, would do with the gargantuan vehicle.
