China's iClone

Cellphones, microchips, cars, even iPhones—there's virtually no high-tech Western product that China's cloners can't copy. Pretty soon, you might even prefer their work

By Dan Koeppel Posted 08.07.2007 at 1:00 am 16 Comments

Counterfeit Road

Sitting in a ground-to-a-halt taxi during rush hour along Beijing's third ring highway (five encircle the city; many more are under construction) gives a visitor plenty of time to rubberneck. The cars are familiar: Volkswagen, Honda and Toyota all have a presence here. But even vehicles with unfamiliar names cut recognizable silhouettes. There's a small SUV, emblazoned with the Laibao brand name, that looks like a twin sister to Honda's CR-V. Although the Geely Meerie is copied from a Mercedes C-class, it costs only 120,000 yuan, or about $15,000.

But at the sweet spot of the Chinese car market are vehicles that sell for around $5,000, just shy of the average middle-class Chinese family's annual income. When you're stuck in traffic, you're surrounded mostly by the ruler in that category: the Chery QQ.

The QQ is a part-for-part reproduction of a car known, depending on where it is sold, as the Chevy Spark or the Daewoo Matiz (the genuine vehicle is built as part of a joint venture between General Motors and the Korean company). Sparks are sold all over the world-in the U.S., an upgraded $10,500 variant called the Aveo is cheaper than any other car you can buy. But when the $5,000 QQ first appeared in 2003, GM-and American officials-were astonished. "If you didn't have name tags on the cars, you couldn't tell them apart," said Congressman James Sensenbrenner of Wisconsin after a 2004 trip to China. "It's such a good knockoff that you can pull the door off the Spark and it fits on the QQ, so close that the seals on the doors match right up."

The ability to clone such technologically sophisticated products is a recent development in China. A report issued by the consulting firm A.T. Kearney breaks the growth of China's cloners into five distinct periods. The first, in the 1980s, was primitive, consisting mostly of cheap textile knockoffs like Mickey Mouse shirts. The second, starting around 1990, still involved clothing and accessories, but with enough authenticity-high-quality Nike and Reebok fakes led the way-to be accepted as handy substitutes by thrift-conscious Westerners. By the middle of that decade, Chinese copiers had moved from basic trademark infringement into low-end technology products: Duracell batteries and DVDs. From there, the study says, an era of "advanced technology piracy" began. Functionally close-to-the-mark products like Callaway golf clubs and counterfeit automotive safety glass appeared in 1998. By the millennium, piracy had reached levels of refinement that saw China offering functional duplicates of Intel processors, Viagra tablets and Bosch power tools.

In many ways, this is similar to the path industrial powerhouses like Japan and South Korea have taken. China has gone from making only cheap, toss-away goods, like budget toys and portable CD players, to creating alternatives to nearly every one of the West's most admired brands. But China is unique in that-as with its modernization in general-it's doing so at an accelerated pace, going from shoddy to quality in little more than a decade.

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