"Paul M. Eldridge" wrote:

> > Why not enact a trade law along the lines of - for every Korean,
> > European or Japanese car that is driven off a ship at a US port
> > of entry, that a US-made car must be exported to Korea, Europe
> > or Japan?

> > Level the playing field, and then let auto makers compete with
> > each other globally.

> Setting aside the issue of restrictive trade barriers for the
> moment,

But these restrictive barriers already exist, and work against the
domestic US auto makers.

> is the Korean marketplace large enough for Chrysler to build a
> profitable distribution network and, if so, how much would that
> cost?

Ok, so you're going to focus on Korea, and not Europe or Japan.

If the Korean marketplace is large enough to support it's own intrinsic
manufacturing, sales and distribution network for vehicles, then it's
large enough to support the sales and distribution network of foreign
vehicle makers.

South Korean auto makers rely inordinately on foreign sales for their
operations (the Jap auto makers are also relying more on US sales in
recent years as domestic Jap car sales have been declining).

In 2006, total SK automobile production was 5.81 million units (increase
of 11.5% over 2005).

Of those, 1.15 million were for domestic sale, and 4.66 million were for
export.

http://english.peopledaily.com.cn/20...03_337790.html

> is the Korean marketplace large enough for Chrysler to build a
> profitable distribution network and, if so, how much would that
> cost?

There were 1.67 new vehicles (cars and trucks) sold in Canada in 2006.
52% of those were cars (868k). Of those, 1/3 or 290k cars were built
overseas (presumably not built in North America).

If a market that bought 290k foreign-made cars is large enough to
justify foreign companies to set up sales and distribution networks,
then I'd say that the Korean market (48 million, or 45% larger than
Canada's population) could easily build within a few years to that level
of foreign sales (assuming a level playing field).

To put things into perspective, total new vehicle sales in the US in
2006 was 16.55 million (I think this is both cars and trucks). In 2007,
this number dropped 3% to 16.14 million.

> Would the return justify the investment or could this money be
> better spent elsewhere?

US auto makers would not have to outlay a lot of cash to sell into South
Korea, assuming that South Korean import laws, customs and duties were
equitable or on-par with US counterparts. Let individual Korean
investment groups and individuals set up franchises and dealerships to
sell US-made cars. That can't happen if the cars aren't being allowed
to be shipped into the country in the first place.

> More to the point, are Chrysler's products well suited to the
> taste and needs of these foreign markets?

Obviously if the foreign car makers are selling their foreign-made cars
in both their own market and the US market, that there is a commonality
between the "tastes and needs" of both markets. So there should be no
such barrier to sales of particularly the small US-made cars in those
foreign markets.

> My sense is that if Chrysler, GM and Ford can't win the hearts
> and minds (and wallets) of North American car buyers, they're
> not likely to do much better elsewhere.

The US is the dumping ground of ALL foreign car makers. Only the US
allows foreign car makers complete and free access to sell their
products. All other countries with a domestic auto industry protect
their markets from foreign imports.

Until or unless there is a level global playing field with respect to
the importation and sale of foreign cars, we will never know if US-made
cars would, or could sell in foreign markets to the extent necessary to
change the financial bottom line of the US big-3.