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Chinese close quality gap

Quality street: Geely's Emgrand EC7 will help to define Chinese quality to Australian consumers when it arrives here later this year.

Export quality almost within reach of Chinese car factories, survey shows

General News logo22 Jun 2010

CHINESE car quality has improved dramatically in the past 10 years, according to data released to GoAuto by the world’s leading vehicle quality authority, J.D. Power and Associates.

Annual surveys of Chinese car owners show that Chinese car factories are fast catching on to the quality levels required to start exporting cars to western car markets in earnest.

The data shows two levels of quality – the cars made by domestic Chinese car-makers such as Chery, BYD and Great Wall and cars made in China by Japanese, European, Korean and US car companies in partnership with Chinese car-makers.

In terms of faults per 100 cars, Chinese domestic car-makers still lag well behind the quality of cars made by the foreign car makers – a clear indicator that the overseas car makers are bringing with them valuable vehicle production knowledge and transfer of technology.

But the gap between the domestic brands and the foreign brands is narrowing. Nor are the domestics chasing a stationary target with the data showing that the foreign car-makers are also squeezing increased quality out of their car factories as well.

In 2000, the Chinese domestic brands were throwing up 834 quality faults per 100 cars – a horrendous figure that would scare off the bravest of candidates seeking to export Chinese cars into Western car markets.

The foreign brands, at 438 faults per 100 cars, had half as many faults but still enough impediments to drive off any serious thoughts of sending these Chinese-made cars to the west.

 center imageLeft: Great Wall V240 Cab-chassis. Below: Chery A1.

At that time the gap between the domestic and foreign brands was a massive 396 faults per 100 cars which suggested that it would be a long time before the Chinese domestic brands would be any serious threat in Western markets.

But, in just two years, the Chinese domestic brands had more than halved their faults to 399 per 100 cars and had caught up to where the foreign brands had been just two years before. The foreign brands, meanwhile had improved to 246 faults per 100 cars.

So, in those two years to 2002, the gap between the Chinese domestics and the foreign brands had been closed from 396 faults per 100 cars to 153 faults per 100 cars.

From then on it became harder to make gains in the intervening years but, in the latest 2009 survey, the domestic Chinese car-makers were at 258 faults per 100 cars and the foreign brand car makers were at 142 faults for 100 cars. The gap between the two was 116 faults per 100 cars.

By comparing this data with J.D. Power surveys of US car buyers who bought US brands made in American car factories, the faults of the Chinese domestic brands in 2009 were still way off the scale. But the faults reported in the foreign brands made in China are roughly the equivalent to the faults reported by American car buyers in their domestic cars in 2002. This suggests that in 2009 the foreign brands made in China are about eight years behind the quality standards of the US car-makers in America.

But improvements since then show the gap by 2009 between the foreign cars made in China and US cars made in the US was just 30 faults per 100 cars or less than one fault per car difference.

This suggests that on quality at least, cars of foreign brands in China could just about be ready to hold their own in the US market, which would leave them not far behind for markets such as Australia.

In another key indicator that the Chinese car-makers are on a roll on car quality, J.D. Power reported that the number of Chinese car owners “experiencing problems with their vehicle since owning it” has dropped from almost 60 per cent in 2004 to 28 per cent in 2009.

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