Emerging Markets have Emerged
It’s no big news that business in Asia-Pacific is booming. Growth rates have been very high for a number of years. But a couple of recent articles about the auto industry in Asia caught my eye. It’s time to look for a replacement to the phrase “emerging markets”.
Just a few years ago, people in many countries took to the streets to protest against globalization. One of the rallying cries: “Globalization takes away our jobs”. It’s true, many factories have moved to low-cost countries (LCC) in order to remain competitive. But personally, I believe that it won’t take long before globalization evens things out. The rapid speed of transformation is mind-boggling.
Tata from India looks to buy Jaguar Land Rover
One example: more Asian companies are investing in and purchasing European and American companies. We sit up and take notice when those companies happen to be big brand names, like Jaguar and Land Rover, two British automotive marques which are up for sale by their current owner, Ford. Based on what I have read and heard, most people connected to Jaguar are happy that a buyer with deep pockets and automotive experience has been identified. Emotions, however, have flared up over this development and some in the UK are referring to it as “reverse colonialism”. I guess if your late Uncle George served as an officer of the British Empire in India, you would have a critical viewpoint.
China is now Audi’s largest export market
Audi, a German manufacturer of premium automobiles, reported 25% growth in China in 2007, making China their largest export market. Most of the vehicles sold in China were produced locally. (Reference.) One reason for the growth: Audi has ranked number one in the J.D. Power’s Customer Satisfaction Index in China for the past two years. (Reference.)
Comments from the Automotive News World Congress
The Automotive News World Congress is held every year in Detroit in January. It is potentially the most important gathering of CEOs and top managers for this industry. This year a panel was held to discuss strategies for adapting to business ways in Russia, India and China.
Chris Lacey, General Motors executive director for central and eastern Europe, said, “Can we, as an industry, stop calling these markets emerging? They have emerged,” he said. “They’re growth and they’re opportunity markets. And if we forget that or ignore that, it will be at our peril.”
Jim Hudak, Metaldyne’s vice president of sales and engineering in the Asia-Pacific region, was also a member of the panel. “Generalizations don’t have any place in today’s global marketplace,” he said. “There’s no ‘Asia Inc.’ Business is done differently in each country and with each customer.” To become a global partner, Hudak said, suppliers must understand cultures and corporate strategies and how they differ from the way business is done in the United States.
Wow, those are both very powerful statements.
Globalization is no longer just about moving factories to low-cost countries. It’s about international business, international brands and understanding different countries in order to take advantage of the growth opportunities which are there.
What are your thoughts on globalization and emerging markets? Has globalization helped or hurt your business? Why?
Image from www.damonent.com.
Tags: Audi export markets, automotive industry, automotive news, emerging markets, globalization, Jaguar, Tata
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