Although India and Sri Lanka are actually the real sources, China's often considered the land of tea -- so let's call this the proverbial tempest in a teapot.
Now that China's Changfeng Group has debuted at the Detroit Auto Show this week, automotive journalists are all agog over the prospect of Chinese pickups and SUVs invading the U.S. market within two years. Apparently, the Liebao CS6 SUV and Feibao CT5 pickup that the company displayed are but the vanguard of a new invasion that could do to GM (NYSE:GM), Ford (NYSE:F), and DaimlerChrysler (NYSE:DCX) with trucks what Korea's Hyundai did to them with cars.
History lesson
That, however, is precisely the point. It's true that new automakers tend to enter the market in a pattern. In the 1950s, when Japan began selling cars here, the offerings were a far cry from the perennially quality-survey-toppingToyotas (NYSE:TM), Hondas (NYSE:HMC), and Nissans (NASDAQ:NSANY) that win accolades from J.D. Power today. It took those companies half a century to reach this point. Similarly, when Hyundai began retailing its rickety rides in the 1980s, even the prospect of being able to buy two Excel sedans for the price of a single Chrysler wasn't enough to put the firm in the big time. It's taken more than two decades of steadily improving quality -- plus competitive pricing -- to lift the company up to its present, still minuscule, 2.5% U.S. market share.
Future lesson
I fully expect the same thing to happen with Chinese trucks in general, and more so with Changfeng's trucks in particular. At present, the firm lacks the backing of a major U.S. partner, unlike fellow Chinese firm Chery Automobile, which will be partnering with DaimlerChrysler. Even if Changfeng meets its goal of introducing its wares to the U.S. market two years hence, the firm will still lack a base of trained repair technicians, a logistical system for providing parts, and so on. Support networks like that take time to build.
Moral of the story
Price alone won't be enough. First you need quality, then a network. Otherwise, Changfeng's fate will follow that of the Yugo.
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Fool contributor Rich Smith does not own shares of any company named above. The Fool has a disclosure policy.
