America got the world driving. Now it’s going home
Carl Benz might have invented the automobile, but it’s the United States that got us to drive them.
The relentless export of American cars and car culture put the world on the road in the 20th century. By the 1960s, Ford Motor Co. had plants in almost every major European country, as well as Argentina, Brazil, Egypt, India, Israel, Peru, Pakistan, South Africa, Turkey, and Zimbabwe.
Right now, it’s passing that baton to China with barely a fight. The US car industry that emerges will be smaller, less influential — and, eventually, less profitable and financially sustainable.
The immediate question is over the fate of General Motors Co.’s Chinese units, mostly joint ventures with SAIC Motor Corp. That company, controlled by Shanghai’s city government, is best-known internationally for reviving the storied British MG brand with a range of affordable, export-oriented SUVs and hatchbacks.
It’s no secret that these ventures are struggling. A decade ago, equity-accounted income from China made up more than half of GM’s net profit, but in the first nine months of this year they racked up a $347 million loss. “It’s a difficult market right now,” Chief Executive Officer Mary Barra told investors in July. “Very few people are making money.”
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