China to Buy Ford or Holden!!!!!

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Analyst: Cashed-up Chinese buyers waiting in the wings
Barry Park
July 7, 2011
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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.

A Treasury Asia Asset Management investment analyst, Tan Eng Teck, said there were already cashed-up Chinese investors casting around 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 the car maker Geely picking up the assets of the 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 the Chinese car distribution business Pang Da.

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

Ford, Holden and Toyota have all warned they could abandon car-making operations in Australia after the federal government dumped its $1.3 billion Green Car Innovation Fund, designed to keep local car manufacturing competitive with imports, just over two years' into the fund's 10-year timeline.

The chief executive of Holden, 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 viability of the car maker.