Hours before Lou Dobbs’s “War on the Middle Class” special was set to air on CNN, the October 18 New York Times poked holes in one of the fears Dobbs has often peddled to viewers – the “threat” to the U.S. auto industry from Chinese imports.
On the Jan. 3, 2005, “Lou Dobbs Tonight” reporter Bill Tucker warned Dobbs that “the man who brought you the Yugo” would be bringing Chinese automobiles ashore by 2007. “That would be the fastest launch of a car brand in history,” Tucker added.
Tucker left out how the Yugo, a cheap Yugoslav import peaked at 50,000 in annual sales before being pulled from the market just five years after its American debut. The Yugo name instead became synonymous with shoddy workmanship.
On Jan. 10, 2006, Tucker filed another story projecting that Chinese autos may be rolling off the showroom floor by 2007. Dobbs reacted indignantly, complaining about the cheap labor cost, $3.50-an-hour to produce the auto in China.
“Forget the living wage and a living standard,” Dobbs huffed. Nowhere in the Tucker story did the reporter examine how cheap automobiles could benefit working poor families in the United States who otherwise might be priced out of buying a much-needed car.
But aside from Dobbs’s unfounded fear of free trade, his report looks laughable in hindsight. It appears the red dawn Dobbs feared from communist China is far from breaking over the horizon.
“Despite growing anxiety that the Chinese would quickly seek to conquer yet another important industry, it now looks as if it will be at least another several years before Chinese automakers start exporting large numbers of cars they both design and make,” Times automobile reporter Keith Bradsher wrote in his front page article.
Aside from poor aesthetic design, poorly organized production plants, and inadequate safety standards, Bradsher added that “the global market” for motor vehicles “has become so integrated and competitive that China will have to move much faster” than Toyota or Honda did when they debuted at American dealerships.
For instance, Japanese automakers “had time to experiment with inexpensive subcompacts, like the early Honda Civic, before moving to reliable midsize cars and on to technologically advanced luxury models.”
In other words, the quality and affordability of car brands already in the market poses a big challenge for Chinese companies to compete with established lines, much less shutter American auto plants.