Is Dow's Close Over 11,000 Important?; Malcolm Bricklin Wants Chinese Cars In America
SERWER: The North America International Auto show kicked off this week in Detroit and a car company called Geely is creating a lot of the buzz. It's the first Chinese care company to have an exhibit at the show, and although the first Geely isn't expected to be available to American drivers until late 2008. Another Chinese automaker will likely beat Geely to the U.S. market. There you go. The first five models are expected to debut late next year. Malcolm Bricklin, founder and CEO of Visionary Vehicles is working to make that happen. Malcolm, welcome to the program.</s>MALCOLM BRICKLIN, VISIONARY VEHICLES: Thank you, Andy.</s>SERWER: So, is this for real? Are Chinese cars really going to be zipping up and down U.S. highways and by-ways?</s>BRICKLIN: Absolutely. They'll be zipping up and down U.S. highways in great numbers very shortly.</s>WESTHOVEN: OK, I have a question. We know they're cheap; some of them are pretty good from the pictures. What's the tradeoff? If you're out there buying a car, you know you what to get it cheap, but what do you have to give up? Luxury seating? Safety?</s>BRICKLIN: Well in some of the cars that are going to come from China that's exactly what you will have to give up. Our model is going to be redefining the price of luxury. So what we're going doing is going after BMW and Mercedes and Lexus and Jaguar and Audi and instead of selling them for $35 and $40,000, they'll be sold for under $20.</s>SERWER: I will take that.</s>CAFFERTY: What's going to make an American that has more than one or two options available to buy a car, to go and decide to buy a Chinese car. They're untested, they are unproven, they are unknown and they have funny names.</s>BRICKLIN: You are right with all those things except the funny names aren't going to be with ours because General Motors told us that we can't use Geely because it sound like Chevy but we will come up with a good name. But actually why? There is no reason for anybody to come in with another car unless it's coming in from a market that hasn't been served. And we believe the high price of luxury cars is too darn high. And we're going to be selling luxury cars for 30 and 40 percent less than you can buy luxury cars now and if we fulfill our promise, we think a lot of people who will want to buy our cars.</s>CAFFERTY: But how is it luxury car if it is 40 percent less than say Lexus or BMW? Doesn't that make it a mid-priced, mid-sized car?</s>BRICKLIN: It will be a mid priced car, but it will be luxury, meaning the interior will be as good or better. Engines will be as good or better and the warranties, of course, will be better. So you are going to end up with a car that drives as much fun. And it is just better every way around and it just costs less.</s>SERWER: All right, Malcolm, you have been involved with importing, shall I say, interesting cars over the past several decades. I want to revisit history a little bit. You did the Yugo, what went wrong there? And what's to say, this wouldn't be another Yugo?</s>BRICKLIN: Well see what went right there. I was given 50,000 cars a year. That's how many I sold in the first three years. It was the fastest growing car ever brought in from Europe. Dealers were charging $3,000 over list and I sold it out to an investment banker, three years before the country became impossible sell to because the U.N. So it was a successful adventure from my part and from the dealer's part. But the difference is, this company and this country has a factory that is state of the art. And they had a factory that was the reverse of state of the art. When you have a good partner that knows what they're doing on the factory side, you end up with a car that will last.</s>WESTHOVEN: Can we go with safety? Will these cars go through all of the, you know, government-mandated tests? How do you expect them to rank? Do you expect them to do well, better, on the low end but still relatively safe?</s>BRICKLIN: Here's our mandate. Our mandate is to put in every air bag, meet five-star crashes, make sure everything we put in this car for safety and for looks and for performance so we take advantage of the price and that's why we're pricing in midsize instead of coming under $10,000. You can't afford to do it in a car under $10,000. We're expecting to have no compromises when we bring in our cars.</s>CAFFERTY: What about mileage and hybrids and some sort of sensitivity toward the oil and gasoline situation? Tell us about your cars.</s>BRICKLIN: Well, first of all China is a country that needs desperately to clean up their act environmentally. And one day they are going to sell 50 million cars into the market that year. So they are desperately trying to come up to clean and to that event, they are spending a fortune buying technology for hybrid and fuel cells and this year, '06, they'll be introducing their first hybrid from Cherry into the Chinese market. And by '08 or '09, we're hoping to segue almost 100 percent into hybrids.</s>SERWER: Malcolm, are people going to be resentful, though, of a Chinese vehicle in the sense that you know, jobs are disappearing over there? Do you think there is going to be any stigma attached to these cars?</s>BRICKLIN: Absolutely. Just like when I brought Subaru in 1968 for the first couple of years, as we know the Japanese were doing so well, they were buying up Rockefeller Center and you name it. And there was a big backlash and it was a voluntary quota to put in. I'm expecting the same thing here, too. But I believe if everybody really gets the facts, for every job that is lost in the factory, we add three or four jobs in distribution. And although it doesn't do any good for the guy who lost its job, it does do good for the people who end up getting the new job.</s>WESTHOVEN: Malcolm Bricklin thank you so much for joining us. And there is more ahead here on IN THE MONEY. Coming up all revved up and nowhere to go. We'll tell you about some hot new entries in the Detroit auto show this week. And if you've got something on your mind, four wheels or not drop us a line at INTHEMONEY@CNN.com.