Bricklin Hopes to Pave Way for Chinese Cars in U.S.

SUSAN STAMBERG, host:

Today's business news focuses on new car choices.

In the automotive world, there are some people whose names provoke an immediate reaction. One is Malcolm Bricklin.

Bricklin brought the Subaru to the United States in the 1960s. He also introduced American drivers to the Yugo, a meeting some would prefer to forget. And in the 1970s, briefly, he built a plastic-bodied sports car called the Bricklin.

Well, now he's back. He wants to be the first to bring Chinese cars here. NPR's Jack Speer spent a day with him recently and has this report.

JACK SPEER reporting:

It's a big day for Malcolm Bricklin, with back-to-back presentations. Dressed in jeans and a black T-shirt, he's holding forth with a group of car dealers.

For a minimum investment of $2 million apiece, Bricklin is offering dealers a chance to get in on the ground floor of what he believes is the next big thing, cars from China, a concept, he says, is still a bit alien to some of them.

Mr. BRICKLIN: This is the last leg of their decision. It's a long process of, do I want to buy Chinese cars? If I want to buy Chinese cars, which Chinese car makes sense for me to go with? And then, oh my goodness, it looks like Malcolm's the one. Oh, I have to give him $2 million. Do I really want to do that? Okay, well, maybe it makes sense. You go through this whole process and then you come here and then you have to go through the legalities of the private placement memorandum and a business plan and things that they're not used to.

SPEER: After visiting plants in Eastern Europe and India, Bricklin says, he stumbled upon a company called Chery in Wuhu, China. He says it was then he knew he'd found what he was looking for.

Mr. BRICKLIN: What I wanted was somebody who had a factory who would build cars for me as if they were shirts. Here's what I want, here are the colors I want, here's what it to look like, here's how I want it to drive. Here's my money, now give me the very best.

And as I was looking for it, I would say to myself, what, am I out of my mind? Where am I going to find that? Then I got to China.

SPEER: Through his company, Visionary Vehicles, Bricklin signed a distribution deal with Chery, one of the largest state-owned car companies in China. He's ironing out the final details of a proposed joint partnership that will make his company and a network of U.S. dealers part-owners in the Chinese factory.

Some of the dealers are ready to write a check, but others are holding back. One reason may be questions about Chery itself, or whether the automaker even needs Malcolm Bricklin to enter the U.S. market.

Michael Dunn(ph) runs Automotive Resources, Asia.

Mr. MICHAEL DUNN (Automotive Resources, Asia): I could see them having cooperation with Malcolm Bricklin in the initial stage but to have more ambitious plans to appoint several distributors in the future.

SPEER: Originally Bricklin had said that would happen next year. Now he's pushed the date back to 2008, and some doubt cars from China will be arriving even that quickly.

Ms. TINA JANTZI (Manager, North American Forecasting, JD Power and Associates): We're actually looking at vehicles from the Chinese manufacturers not coming into the market before 2009.

SPEER: Tina Jantzi is manager of North American Forecasting for JD Power. She says there are several reasons why Chinese cars may not be ready yet for the U.S. market.

Ms. JANTZI: Standards that they're held to are not quite as strict as what we have in North America. They'll definitely need to do some work on the vehicles themselves to first meet the safety standards, then also the emission standards.

SPEER: Bricklin has received commitments from only about 80 dealers. He needs a lot more. But he remains confident Chinese cars are coming with or without him.

Pointing to a chart showing one of five models he plans to bring in, a hard-top convertible priced at $25,000, Bricklin says the cars will compete with vehicles costing a lot more.

Mr. BRICKLIN: When you open the door, it's going to be, Ah! And when you sit in the car you're going to feel rich. There won't be anything left out of the car because the price is lower than anything else.

SPEER: Still, there are people who also remember some of Malcolm Bricklin's past deals, the $25 million investors lost in the 1970s on the Bricklin SV1, a sports car with gull wing doors that sold fewer than 4,000 copies, followed by the Yugo, and a failed venture to market electric bicycles.

But Bricklin isn't the type to let past mistakes diminish his optimism.

Mr. BRICKLIN: Everything known to man can happen. You want to hear SARS closed down a country, or bird flu closed down the country? Or one our ships goes, runs into another ship, and you say, what could happen? Anything can happen. But I don't see anything that will happen that will do anything more than hiccup.

SPEER: At his New York headquarters, there's a mural of cars on one wall. Cameras follow his on-going negotiations with the dealers. Bricklin's son Jonathan is filming a documentary about his semi-famous father, and the final chapter in Malcolm Bricklin's movie is still being written.

Because of the slower than expected rollout of his dealership network, Bricklin has had to seek outside financing for his venture. An investment bank is putting up $200 million in exchange for an undisclosed stake in Visionary Vehicles, pending completion of the joint venture deal with Chery.

Bricklin says he doesn't expect the presence of a large institutional investor to change his role as head of the company, though he says the bank will have a say regarding what goes on. Visionary Vehicles is likely to face other challenges as well. There will be tough competition from established automakers and from other importers also interested in bringing cars from Chinese manufacturers to the U.S. market.

Jack Speer, NPR News.

STAMBERG: You can see the shape of things to come at npr.org. Transcript provided by NPR, Copyright National Public Radio.