Great Wall and Chery Asbestos Recall Shakes China Auto Industry

Just the Facts:

• Great Wall Motor and Chery Automobile are recalling 23,000 cars and trucks sold in Australia because cancer-causing asbestos was found in their engine and exhaust gaskets.
• Ateco Automotive, the Australian distributor for Great Wall and Chery, said there is "no asbestos-related health risk to the driver or any passengers who use the vehicle."
• But the recall is being described as a major setback to the image of "Made in China."

BAODING, China ? Great Wall Motor and Chery Automobile are recalling 23,000 cars and trucks sold in Australia because cancer-causing asbestos was found in their engine and exhaust gaskets.

Ateco Automotive, the Australian distributor for Great Wall and Chery, said there is "no asbestos-related health risk to the driver or any passengers who use the vehicle.

"It has been discovered that the gaskets contain a small amount of bonded asbestos fiber," Ateco said.

But the recall is being described as a major setback to the image of "Made in China."

"This is a genuine setback for the companies," wrote Hong Kong-based auto consultant Michael Dunne in the Wall Street Journal on Friday.

"The most likely culprit is a China manufacturing phenomenon vividly described in the book Poorly Made in China, known as 'quality fade,'" Dunne wrote. "Companies deliver initial product samples that pass inspection tests with flying colors. In time, however, the quality begins to deteriorate as the manufacturer ? often under pressure to preserve profits ? introduces cheaper or non-standard product materials. The more the material is hidden from plain view, the more likely it is to be replaced."

Australia has been a critical test-bed for Chinese automakers. They had planned to use their experience in that market as a springboard into the U.S. and other markets.

On July 12, 1989, the U.S. EPA issued a final rule banning most asbestos-containing products.

"When handled, asbestos can separate into microscopic-size particles that remain in the air and are easily inhaled," said the U.S. Centers for Disease Control on its Web site. "Persons occupationally exposed to asbestos have developed several types of life-threatening diseases, including asbestosis, lung cancer and mesothelioma."

China is not among the dozens of countries that have banned the use of asbestos.

Inside Line says: A distant recall is sure to have a major impact on the image of Great Wall Motor and Chery Automobile in the eyes of American consumers.

Source: http://www.insideline.com/chery/great-wall-and-chery-asbestos-recall-shakes-china-auto-industry.html

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