Posted by: donmihaihai | April 24, 2008

A Chinese dream : The first car.

SHUANG MIAO, China: Li Rifu packed a lot of emotional freight into his first car. Li, a 46-year-old farmer and watch repairman, and his wife secretly hoped that a car would improve the odds of their sons, then 22 and 24, finding girlfriends, marrying and producing grandchildren.

A year and a half later, the plan seems to be working. After Li purchased his Geely King Kong for the equivalent of $9,000, both sons quickly found girlfriends. His older son married after a short courtship that included a lot of cruising in the family car, where the couple stole their first furtive kisses.

“It’s more enclosed, more clandestine,” Li Fengyang, Li’s elder son, said during a family dinner last week, as his bride blushed deeply.

Western attention to China’s growing appetite for automobiles usually focuses on its link to mounting dependence on foreign oil, escalating demand on natural resources like iron ore and increasing emissions of global warming gases.

But millions of Chinese families, like millions of American families, do not make those connections. For them, a car is something both simpler and more complicated.

J.D. Power and Associates calculates that four-fifths of all new cars sold in China are bought by people who have never bought a car – not even a used car. The number has remained at that level for each of the past four years.

By contrast, less than a tenth of new cars in the United States are purchased by people who have never bought a new car before, and less than 1 percent of all new cars are sold to people who have never bought a new or used car.

The explosion in first-time buyers is the driving force behind the record car sales in the country, up more than eight-fold since 2000. It is the reason China just passed Japan to become the world’s second-largest car market, behind the United States.

One sea change in Chinese attitudes is clear and likely to have broad implications worldwide: Even first-time buyers are becoming more sophisticated and wanting better cars.

Domestic Chinese carmakers like Geely and Chery, once feared by Detroit and European automakers as eventual exporters to Western markets, have watched their sales gain modestly, stagnate or drop in the past year – even while the overall Chinese market has continued to grow roughly 20 percent a year.

The beneficiaries have been the joint ventures of multinationals that sell cars designed overseas, like the Buick Excelle, Volkswagen Jetta and Toyota Camry. Practically every auto expert had expected the multinationals to lose market share rapidly to low-cost domestic automakers.

Instead, Chinese car buyers – including first-time buyers – have become more discriminating about the comfort, styling and reliability of the cars they buy. As a result, local manufacturers are having to redouble their efforts in this market instead of planning to conquer overseas markets.

“Customers are moving up; they want the bigger, more established brands,” said Michael Dunne, managing director for China at J.D. Power. “They’d rather wait, save and buy higher on the ladder instead of buying a smaller car.”

In the autumn of 2006, the Lis did not want to wait. They could not wait, especially Li Rifu.

When the Li family bought their car, they agreed to extensive interviews with each family member in Shuang Miao, a rural village in Zhejiang Province in east-central China. They later agreed to follow-up telephone interviews over the past year and a half and to a long family dinner in Shuang Miao recently to review their experience as first-time car owners. What emerges is a portrait of the rapidly expanding role of cars in the fast-changing ways in which China’s people socialize, marry, raise families and, possibly, die.

Li Rifu was so excited on the day that he bought his first car in September 2006 that he woke before dawn. He fixed breakfast for his wife and two grown sons, then climbed on his white motorcycle for a short trip he had been anticipating for many years.

Li had spent most of his life here in his ancestral farm village, nestled at the base of a steep hill. The embodiment of China’s version of the American dream, he is largely self-taught. He learned to fix watches and got a job as a foreman in a coal mine in nearby Anhui Province by fixing the mine owner’s watch. After saving some money, he came home to start a successful business that now employs five people raising flowers for landscapers.

That September morning, Li rode down the dirt alleys of his village and over a muddy, bamboo-lined stream where local women washed clothing on rocks jutting out into the sluggish current. He reached a four-lane paved road, then a six-lane road, and puttered on to his destination in the nearby city of Taizhou: a car dealership.

Over the course of the half-hour journey, Li was too excited to heed the persistent and unexplained pain at the base of his back.

He had really wanted a black car. But his sons preferred white, saying that it was a more popular choice for their generation, and Li had given in before he set out for the dealership.

“Without this car, my two sons wouldn’t be able to find wives – the girls would not marry them,” he said, reminiscing about how he had needed only a bicycle when he courted his wife in the early 1980s. He ruined a half-dozen tires carrying her on the back of the bicycle for their outings together.

Li took a white Geely King Kong compact sedan for a short test drive, then returned to the dealership and climbed three flights of stairs to a cashier’s office. He pulled a stack of currency thicker than a brick out of a black shoulder bag and paid the equivalent of $9,000 for the car; he would later pay another $1,000 in fees for a license plate.

“The next few days, everyone will want to drive it,” he said proudly, a prediction that proved true. Li talked of his dream of someday driving across China to visit Beijing and Tibet, acknowledging that he would need more driver’s education classes before those long journeys would be possible.

Car ownership helped Li bid for bigger contracts for more flowers. “My customers said, ‘Wow, you came to visit me in a car’ – it puts the negotiation on a whole different level,” he said.

Several months after he bought the car, Li’s elder son, Fengyang, indeed found a girlfriend: Jin Ya, a young saleswoman for China Mobile, a cellphone service. In the space of five months, they had gone to the local marriage registry and been legally wed. Today, both say they want a child someday.

At the family dinner last week, Jin bridled at the idea that young women in China consider a man to be marriage material only if he can take them on dates in a car.

“Not me, not me!” she said passionately, before acknowledging that, “Other girls do say that you need a car.”

But as their Geely King Kong was bringing the Li family new joy, tragedy struck: Li Rifu and his wife, Chen Yanfe, were each diagnosed with cancer.

Chen’s reproductive tract cancer has gone into remission after $7,000 in medical bills. But Li’s fist-sized, malignant prostate tumor – which turned out to be the cause of the mysterious back pain that was bothering him when he first bought the car – has resisted two surgeries and four rounds of chemotherapy. The cost: more than $40,000.

With payments from the local health insurance fund capped at $4,300 per person per year, Li has had to sell many of his possessions, and still he has gone into debt. He wore a cap to the recent family dinner, sensitive about the loss of his hair because of the chemotherapy.

He has just gone to a hospital in Shanghai, a five-hour drive to the north, for more surgery followed by two more rounds of chemotherapy. But he did not go in the family car: He sold it for nearly $8,000 last year to help cover his medical expenses.

It is a common occurrence in this country, nominally communist but with little or no safety net. While many families are scrambling into the middle class and buying cars, others are falling out of the middle class because of business reversals, medical bills or other problems, and they are unable to buy replacements for their first car.

Sadly, the Li family has known new tragedy recently. Their younger son, Fengwei, also found a girlfriend with the help of the family car, the daughter of a manager at a large factory, an impressive person to Li Rifu. But the girlfriend’s father was killed two weeks ago when a construction crane at the factory accidentally dropped its load on him after a crucial steel pin broke.

Despite it all, Li Rifu tries to remain optimistic. He now dreams of regaining his health, earning back the money he has spent on medical care and then – like a growing number of his countrymen – buying a bigger, more impressive car than the Geely he had to sell.

“If I get another car,” he said, “I’ll get a better-quality car, with even nicer seats and better steering.”

http://www.iht.com/articles/2008/04/23/business/23FIRSTCAR.php

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