In China the first day of October celebrates 'National Day', marking the establishment of the PRC, under the Communist Party. This year saw an extra-ordinary effort of 'show-boating' by the country to mark its 60th anniversary – a mark of symbolism as much to the rest of the world as to its own people.
To western eyes that celebration may have seemed somewhat surreal, starting at 2.00am GMT, the President Hu Jintao wearing the eponymous Mao tunic took centre stage, standing upright through the roof-hatch of China's own near simulacrum of a Rolls-Royce Phantom. But with a Chinese twist on the world-class benchmark limousine manufactured by Hongqi, the adapted HQD model – even larger than the phantom - had a re-worked face that reflected the 'glorious past' of Chinese auto marques. That past which ironically were themselves reworks of Eastern European styles derived from US influence which served the Soviet-Sino Communist Bloc for decades.
(As a side bar note also the Geely GE model which mimics the Rolls).
This is not to deride China to any degree, simply that its auto-sector, having arrived so comparatively late, has been a historical story of adaption – firstly from those Czech cars to the American influence of Beijing Jeep in the early 1980s to the almost Baudrillard-like hyper-realism of the Hongqi and Geely GE.
China today finds itself both having to be attuned to our globalised culture where semiotics / symbolism plays such an important role, yet also maintain its own symbolic lineage. This was perhaps the core reason why the Presidential procession appeared so contrived. It may have seemed amateurish to some, but every element serves a purpose.
Perhaps the greatest example of that contrivance were the exteriors of the tanks, missile carriers and other military transport vehicles. For they demonstrated the very paradoxical nature of China's present-day identity, merging both a show-casing of the (to us) distant past and a promising future. This was done via juxtaposed use of 'pixalation-camouflage' paintwork derived straight from a computer video game imagery and white-wall tyres that cognitively demonstrate cleanliness, order, discipline. Thus for western eyes a twisted mix of automotive cultures eras from well before 1949 to well beyond 2009.
Yes, the pixilated liveries combined with white-wall tyres may seem daft, but the aesthetic was unarguably powerful. Almost straight from the Director's mind's-eye, storyboards and edit-suit of 1960s distopian future-scope films like A Clockwork Orange or Fahrenheit 451. Something - unlike the slick latter-day retro-futurist efforts of Brazil, Blade-Runner or The Fifth Element – that was very psychologically jarring. Although all processions are directed, this one appeared almost cinematographically so.
Whist the direction of the 60th anniversary procession was undoubtedly minute perfect, the direction of the country's automotive sector – under the present 5 year plan – has been more questionable to foreign observers.
The past success of speedy and massive economic growth encouraged a plethora of state-derived, joint-venture and all new domestic producers; some as extensions of other industrial works,others as new start-up companies. At one point in mid 2007 there were over 220 enterprises vying for success. Unsurprisingly over-capacity resulted. Recognising this, the current plan called for a consolidation and contraction of the sector, so as to overcome the overt value-destroying nature of sector and to enter a new maturer and value-creating phase. We witness that today as those domestic firms either struggle and close, are merged into bigger fish, or grow as those big-fish. But more so there has been Chinese international ambition as auto-makers try to follow the state plan for globalised Chinese enterprise.
Thus western eyes have been on the likes of BAIC and Geely in their pronouncements regards US divestments in the form SAAB and Volvo...and critically HUMMER.
Unlike GM's other generally questionable off-loaded brands, HUMMER was divested, candidate contested and sold relatively easily and quickly; the successful joint-buyers being Sichuan Tengzhong Heavy Industrial Machine Company (to hold 80%) and entrepreneur Suolang Duoji (to hold 20% via his company Lumena resources Ltd, a sodium sulphate processing company also based in Sichuan). They take the brand, trademark, further trade-names as well as importantly the IPR of the company. A deal struck at a remarkably low $150 million, which includes GM's agreement to manufacture the vehicles until 2012.
Thus, investment-auto-motives sees the deal as much an 'entente-cordial' between the US and Chinese administrations which usurps what would have been far more contracted negotiations on a purely commercial basis had there not been such a desire for as much 'lassez-faire' bi-lateral trade as possible.
Importantly, set against the bigger context the HUMMER deal is not as simple as the “shameful loss of an American icon” as some US blog-commentators quote, but a major step for China in becoming the world's supplier of military transport might.
China has already mimicked the original HUMVEE/H1 with various copy-cat cars (as per Rolls-Royce), but whilst arguably the highest form of flattery, ownership of the original brand has been viewed as vital by Beijing both in terms of innate symbolism as a world player (as seen with IBM laptop – Lenovo) and on pure commercial grounds – militaristic and civilian.
The original HUMVEE has been in service with numerous sovereign & national armies, navies and air-forces across the globe, manufactured between 1992 and 2006 (the Mishawaka, Indiana factory built in 1984) with of course its H1 civilian twin and smaller 'conspicuous consumption' H2 and H3 siblings offered to the 'suburban cowboy' set phased-in over the following 14 years. Today HUMMER is assembled in the original Indiana plant (H1, H2), Shreveporte, Louisiana (H3), Port Elizabeth, South Africa (H3) and licensed build in Kalingrad, Russia (H2). Under Sichuan Tengzhong Heavy Industry it appears that it will be business as usual in the US with a new Detroit HQ created, but whilst many expect yet another 'lift and shift' operation of the US tooling, frames etc investment-auto-motives suspects that whilst so for H2 and H3, H1 will remain in situ with a replicant set of tooling, set-frames et al created for a new production site in Sichuan or thereabouts.
Though the allocation data for the international fleet size/car parc for military HUMVEEs is not immediately available, it is a fact that the vehicles are incontestably aging. If we assert that the peak of production & delivery was during the late 1990s, then much of the fleet is already 10 years old, with oldest US vehicles about 20 years old. Thus Sichuan Tzenghong will have 3 main goals:
1.Production of new HUMVEE vehicles for China's own massive appetite
2.Repair & Reconditioning of the large international HUMVEE fleet
3.Introduction of HUMMER as a new domestic consumer brand
Thus critically, Sichuan Tengzhong now has both global reach given its worldwide plants and critically both military and civilian operations. This provides the ability to directly replace GM by servicing the world's forces with a full portfolio for medium-size, medium (off-road) ability vehicles across “Dark Green” (front-line theatre of war), “Light Green” (intermediate range) and “White” (non-combat/logistics) operations.
The standardisation of vehicle fleets achieved via expanded 'modularisation' and package-protected technically-specific variants has been an ongoing ambition of international MoDs given the cost efficiencies attained from homogeneity and of the growing trend toward combined mult-force operations under NATO and UN banners requiring inter- interoperability. (This in turn applicable to Red-Cross, Red-Crescent & now Red-Star emergency aid and Peace Corps operations)
Broadening the view, whilst the Chinese have now taken the 'Medium' weight category with HUMVEE, India has already seized the opportunity to 'sew-up' the Light' weight category with both its own 'old' 4x4 products and the newer Land Rover vehicles, specifically “White Discovery” and “Light & Dark Green” Defender – themselves seeking learning from previous mid 1990s 'Wolf' (attack vehicle) and 'Pulse' (ambulance) projects which have themselves begot ongoing fleet repair & maintainance contracts).
Looking back to China, and the plethora of heavy military transport machinery on show at the 60th anniversary celebration intentionally demonstrated the front-line power of China. And whilst undeniably it has a sizable intermediary and logistics fleet derived from ex-Soviet and homegrown products, the PRC high command recognised that to be integrated as a world-player that 'back-office' capability had to be both updated and (globally) co-ordinated.
So instead of simply buying the relevant apples, given its massive US$ reserves and the current positive FX benefit of the Yuan vs US$, it instead bought the whole apple stall. Moreover, very importantly by buying HUMMER China has now effectively become a co-optive international partner amongst the leading G20 nations.
And for its own benefit HUMMER will bring a long-horizon of demand from its newly purchased global vehicle parc centred around the key values of:
1.Affordability (for stretched western defence budgets)
2.Durability (from innate design)
3.Inter-changeability (important for rapid response and in the field repair)
4.Flex-tech (providing mission specific 'strip & re-build' 4x4 platforms)
In an age when arguably much of the use of military might on the international stage relates to the social unrest induced from national fracturing – primarily in Africa, CIS states, S. America - peacekeeping and nation-building is the remit of the day.
And as we've historically seen with Jeep, Land-Rover and UAZ, such HUMMER 'birth-origins' make for a powerful brand that stretches with credibility into the realms of commercial utility vehicles ranging from the 'low plains' of agriculture to industry to infrastructure work, right across to the 'high-plains' adventure and expedition.
Jeep conquered Europe and Asia in the 1940s, Land Rover conquered Africa in the 1950s & 1960s, UAZ conquered Siberia in the 1970s and Toyota conquered EM regions in the 1980s and the Arctic in the 2000s.
HUMMER will now conquer China and commercially harness the world beyond.
So although front of stage the discordant sight of a mock Rolls-Royce set amongst an ocean of people and war equipment creates that image of a distopian future-scope to western eyes, let us not be blinded by first impressions. The purchase of HUMMER perhaps says more about China's global integration to an international business & political audience than the choreography played-out by the PRC for its own citizens and the general global audience.
