China now has its own luxury car brand. From Fortune:
For only the second time in recent history, a large, thriving, privately owned Chinese company has stepped up and stepped out -- buying a big brand known the world over. Six years ago, computer maker Lenovo bought IBM's personal computer business and has struggled to manage it ever since. Now, Zhejiang Geely Holding Co., a rapidly growing Chinese automaker based in Hangzhou, bought Volvo from Ford Motor for $1.8 billion. . .
[T]his deal [is] one that an eager seller (Ford) wanted. (How eager? It paid $6.45 billion for Volvo in 1999.) . . . Gothenborg, home to [Swedish] industrial crown jewel [Volvo], no doubt wanted it even more. Better than getting shut down entirely, and it's not clear that a lot of other buyers were willing to step up. So Geely, which makes low-end small cars in China, wins what it hopes will be a prize, and gets to move up-market with a classy brand.
Robert McNamara, the former Defense Secretary and Ford CEO, once said we should let the Russians build automobiles for their people, because the resources needed to make the resulting auto-crazed population happy would drain the country’s war-making capability.
Will McNamara’s logic apply to China?