China FirstIt's a sure-fire formula for despair

First it was Jack Smith of General Motors declaring that he wanted 10% of the Asian market. Ford wasn't going to be left behind or take a whit less than GM and said it wanted 10% of the Asian market.

Now somebody else - it could be DaimlerChrysler or Renault, it doesn't really matter - wants up to 25% of the Asian market. I suppose before long Volkswagen and Fiat and Peugeot (or maybe not Peugeot, I think they've had enough bad experience) will announce that they want their 10%.

With all these Western automakers each getting 10% of the Asian market, it doesn't look like there will be very much for the Japanese. I suspect Toyota and Nissan and Honda and Mitsubishi and Suzuki are just quivering in their car seats already, worried about all the market share they'll lose. Just as they panicked a few years ago when our Big Three announced how much they were going to storm into the Japanese home market and grab a chunk.

Get the idea? There is some mighty unrealistic dreaming going on.

First, 10% is an enormous share. GM and Ford have been in Europe for 70 or 80 years and they've got about 11% of the market each (Ford picks up a bit more with Volvo). And that's after close to a century of hard work.

Second, Mr. Toyota and Mr. Honda and Mr. Subaru are just as touchy as Mr. VW and Mr. Fiat and Mr. Renault are in Europe. They aren't going to give up anything. You have to tear it away from them, and they are tough. And everyone isn't going to do it.

You think we can buy it? Not a bad idea, either. Heck, how do you think GM got up to 10% in Europe. GM bought Opel. And, of course, we have been buying in Asia. GM controls Izusu, and Ford controls Mazda. But you only get to buy the troubled companies, and it's work getting them out of trouble. It's just as likely they become sinkholes for money. BMW is finding that out with Rover.

In fact, Detroit's expensive Asian plans have taken quite a knock.

Those big plants Ford and GM built in Thailand are in trouble (no business because of the recession there). I hear GM will be building little minivans in its Thai plant and shipping them back to Europe, which will make their unions happy, I'm sure. The Indian ventures aren't doing much better. The plans to build industrial bases in Korea (GM with Daewoo, Ford with Kia) and Indonesia fell apart long ago. And Mazda and Isuzu have a long way to go.

GM and Ford actually did a fine job in Europe. Both created semi-autonomous companies, designing vehicles for the European markets. And they became part of the European landscape.

Over time that may be what happens in Asia and India, vehicles designed for those markets, vehicles that don't have much place in America or even Europe.

There's nothing wrong with wanting to sell vehicles in Asia and becoming a presence there. What I find foolish is a policy that I call "China First."

China First means being hypnotized by Asia, worrying more about Asia than California. Being hypnotized by the potential - all those people - isn't uncommon. You know, there used to be an old saying in Britain that went something like, "If every Chinaman lengthens his trousers a quarter inch, then the mills of Manchester (or Lancaster, I never keep them straight) will run for 100 years." Well, they didn't, and so the mills weren't saved by China. Now it is that way with cars.

Putting Asia first is also an excuse; when you lose California, you can always tell your board of directors it's China First, and it will be a decade before you see the results. So as a manager you are off the hook, because in another decade, when you've lost California and are doing nothing in China, you are retired in Hilton Head.

I always admired Bob Eaton of Chrysler because when the Chinese got too demanding in the bidding for the minivan plant there, he told them to go stick it. Daimler jumped in and won the contract. Of course, Bob was right, and Daimler hasn't built any minivans in China.

The key world market for American producers is not China, or India, or Thailand, or Brazil or Argentina, or even Germany or Britain.

They all are important, sure, but the key market is the U.S. and then Canada and Mexico, the home turf. Whatever your ambitions globally, the first duty is always to protect the home base.

Yes, we have a global economy, and we build vehicles around the world, and the foreign companies build vehicles here, lots of them. But I still like to see the Detroit-based companies winning, even though I have the greatest respect and admiration, too, for the competitors from Japan and Germany and Korea. Nothing against the Italians and French; they just don't sell here. And, remember, all those other guys are planning to grab 10% of this market, and a couple are just about there.

Fortunately, what looks like winning product is working its way off the design boards and into the factories. We held off the foreign competitors with those trucks, the minivans, pickups and sport/utilities.

Detroit - Chrysler, Ford, GM - got there firstest with the mostest. Now the other guys are catching up: excellent minivans from Honda and Toyota, fine sport/utilities from just about everybody, and even a big pickup from Toyota. But here come sport/utility vehicles with pickup beds from Ford (Explorer Sport Trac), and a gem of retro styling from Chrysler (PT Cruiser, and while it might be DaimlerChrysler, the Chrysler half is still Born in the U.S.A.) and a really ugly vehicle from GM (Pontiac Aztek) that might be a home run. This is good news.

These may be the vehicles to help the home team retake California.

Wouldn't that be something? Sure, Asia is going to be important some day, but I say California First.