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To Own a Car in China

Human behavior is fascinatingly difficult to predict. Throw a new element in the mix, and who knows what you'll get. The introduction of a serious, middle-class car market in China is confounding analysts' predictions. The New York Times tells a story today that traces the rise of the car as social capital in the lives of families in China. The minds of Chinese entering the car market for the first time are a million miles from either the economic and environmental concerns that we hear in Washington or the predictions of analysts who thought Chinese would start small and gradually, if at all, work their way up to Western-style class conscious cars:

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...

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, instead of planning to conquer overseas markets, local manufacturers are having to redouble their efforts in this market.

"Customers are moving up, they want the bigger, more established brands," said Michael Dunne, the 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."

Why? Because the right car can literally translate into a better marriage for a consumer's children, access to social and financial circles that would have been otherwise unreachable.

I'm always amazed at how the dream of a better life for one's children plays out. As author David Rothkopf noted at The Aspen Institute yesterday, without China, the U.S. doesn't stand a chance of doing anything meaningful on most global issues, most notably climate change. From that perspective, the story of what drives car sales in China is pretty important.

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