GM Takes Chinese Car Maker To Court
After a long careful study, General Motors has decided
to sue Chinese state-owned car maker Chery, for stealing
a design from Daewoo and introducing it in China. General
Motors made the decision only after studying the issue
with Chinese government authorities who want to establish
Chinese courts as being at least somewhat independent
in the business cases they handle.
The car, which is marketed under the QQ label in China,
is substantially similar to the Daewoo Matiz, which is
manufactured by GM as the Chevrolet Spark. GM claims
that the Chery QQ and Chevrolet Spark "shared remarkably
identical body structures, exterior designs, interior
designs and key components and that the vast majority
of parts in the Matiz and Chery QQ were interchangeable."
While an issue of this kind would seem very straightforward
to non-Chinese, GM has approached the issue very carefully
because of the importance of the Chinese domestic market
and its partnership with SAIC,
which also had a relationship with Chery.
Previously, Toyota had lost a trademark violation case
in Chinese courts. In other markets, most makers would
have scaled back their investments, but such is the growth
of the Chinese market, that Toyota has
ramped up its investment.
GM claims that the Chery QQ has been a highly successful
model in China, and that the company has started exports
of the model into other markets. Sales of the Chevrolet
Spark have lagged behind QQ sales.
The Chinese government is also anxious to show non-Chinese
investors that the Chinese judicial system is able to
act as a fair arbitrator and judge in intellectual property
violations, even when the defending party is a Chinese
state-owned enterprise. The simple fact that the Shanghai
court has agreed to hear the case suggests that the Chinese
government knows that the case will be closely watched
by trade officials in the US and WTO.
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