More Chinese travel nightmares

Have I mentioned that travel in China is terrible? I'm sitting at Beijing Capital Airport right now. My flight was supposed to take off at 6 PM. It's now 7:30, but there is no indication of whether or not my flight will even take off tonight. It hasn't been cancelled, or even officially delayed yet. Chinese airlines don't delay a flight until a new departure time has been established. So even though the plane I'm supposed to be on is still parked at the gate in Shanghai, my flight is still "on-time."

All flights until tomorrow evening are also fully booked, thanks to undercapacity on the Shanghai-Beijing route as well as general equality among customers. Whereas in the United States, people would get bumped or volunteer to be bumped and get compensated, China treats everyone the same. All well and good for social equality, but I would pay $1000 to get back to Shanghai right now to see my wife, and the farmer next to me who paid $40 for his ticket is going to go first. Capitalism without a doubt leads to more efficient outcomes than communism.

Update: News reports indicate the frequent heavy fog in Beijing is due to particulate matter, i.e. pollution.

Auto update

The timing of my last entry was quite... timely. Today's WSJ Asia front page article is about the push for cheaper cars in emerging markets. I also want to correct a comment I made in the last post. The cheapest Chery QQ, with a 800 cc engine is $3,600. But, it's not the cheapest car available. That prize goes to the BYD F1, which can be had for just $3,000.

Crazy automobile market

Visitors to Beijing always remark about the horrendous traffic situation. There are seemingly millions of vehicles clogging the roads at all hours. Add this to an ineffective subway system, and it can take over an hour to just get across town.

In Shanghai, it's less of an issue because the city charges outrageous amounts for a vehicle registration/license plates -- currently about $5,000 USD! In Beijing, the fee is less onerous and there are plenty of cars and taxis to go around.

For my latest project, I have the opportunity to look at the market for luxury autos in China. So far, I have been very impressed with the Chinese appetite for foreign cars. Imported cars made by companies like Volvo, Lexus and Mercedes cost about twice the amount they do in the United States. In China, a Mercedes S600 lists for more than 1.7 million RMB - $225k USD. Yet there are still over 10,000 people per year lining up to place an order.

Of course, cars in China are a bit different, especially those that cost more than $40k. Chinese consumers like big cars, particularly cars with large rear passenger compartments -- if you can afford a nice car, you probably aren't driving it yourself. Therefore, car buyers focus less on the controls upfront but rather the experience in the back as a passenger. Also, Chinese people don't drive fast - they never get far enough outside the city or away from traffic to go Autobahn speeds. So you can end up with some relatively underpowered engines in otherwise big cars. Unlike Germans, the Chinese consumer doesn't like to "feel" the road either. They want a soft ride that makes them feel like they're sitting on a cushion. That's all fine and dandy since they aren't making high speed turns anyway.

There are locally made versions of foreign cars for sure. Volkswagen and GM both make most of their cars for the Chinese market in China. Toyota is strong as well. But what about purely local cars like the Chery and Great Wall? They are cheap; you can pick up a Chery QQ for $4000. They certainly get the job done and are very popular in Beijing. In Shanghai, since the cost of the license plate will double the overall cost, most people opt for a VW, or no car at all.

Online travel sites

Online travel sites are not the best here in China. The two market leaders, Ctrip and eLong, are okay for booking hotels, but the flight selection is difficult. Most of the time, it's easier just to go to a travel agency in person to buy the ticket and pay in cash. Also, for some technical reasons, local mom-and-pop travel agents can often give you lower prices.

For international flights, I have resorted to using Kayak at times, since it's less complicated than visiting a travel agent to browse flights. Even if I don't purchase the tickets through Kayak, it can at least tell me what flights are available. However, I was using it recently to check out flights from Taipei to Kuala Lumpur (I know it's not a very popular flight segment). Here was one of my suggested itineraries:

Flight Information – Wed 21 Nov 2007 This flight leaves and arrives on different dates. American Airlines Flight 7958 Operated by EVA Corporation Departs: 11:55p Taoyuan Intl (TPE) Arrives: 7:40p Los Angeles (LAX) Coach Aircraft: 777 11h 45m [ Layover in Los Angeles, CA (LAX) for 16h 05m ] American Airlines Flight 169 Departs: 11:45a Los Angeles (LAX) Arrives: 4:40p Narita (NRT) Coach Aircraft: 777 11h 55m [ Layover in Tokyo, Japan (NRT) for 21h 00m ] American Airlines Flight 5838 Operated by Japan Airlines Departs: 1:40p Narita (NRT) Arrives: 8:20p Kuala Lumpur Intl (KUL) Coach Aircraft: 767 7h 40m

	Airfare	Taxes & Fees	Total Cost
American Airlines	$2125.00	$81.30	$2206.30	select

I'll do the math for you: 68 hours and 25 minutes to travel 2000 miles. That's an average of 29 miles per hour. I could probably rent a speedboat and get there faster. Surprisingly, it's also slower than the Taipei-Hong Kong-Shanghai route. Needless to say, I think I'll look elsewhere for a ticket.

Chinese politics

The 17th Chinese Communist Party Congress just ended in Beijing today. Last week, I was in Beijing when it was still in session and definitely noticed a lot more government cars (black Audi A6's) and BMWs (non-government party members?). There has been a bit of a change in the party leadership in a realignment heading into the 2012 selection of a new president. Most notably the vice-president, Zeng Qinghong, has stepped down and the new Shanghai party boss, Xi Jinping, has been elected to the central committee.

I'm not expert in Chinese politics, but here is a brief backgrounder on Shanghai and its relations with the central government, which is of course based in Beijing. Shanghai (and East China) has always played a small role in defying the Communist party. The Nationalist government was based in Nanjing - just an hour's train ride away from Shanghai. Not until Jiang Zemin came to power in 1993 did Shanghai receive a little more attention from the national government. Notice the correlation between Jiang's promotion to head the country and Shanghai's recent rise to wealth and power.

Hu Jintao, who is of course not from Shanghai, is still trying to rid Jiang's influence from the party leadership and has been trying to get rid of people still loyal to Jiang. Chen Liangyu, the former party boss in Shanghai, did a good job in continuing Shanghai's economic development. In fact, he did "too good" of a job. The economy was overheating, driving real estate values and inflation up. Good for Chen, who was enriching himself with side deals, and good for the city, which was becoming a booming global center for commerce. But it was bad for Hu, since Chen defied central party leadership and allowed Shanghai to outshine Beijing. So, long story short, Chen was arrested for corruption and graft. Experts say that he is indeed guilty, but major party members participate in similarly illegal activities. It is only his disfavor with Hu that lead to his demise.

My Chinese tutor told me an interesting story about when she worked at the local newspaper a few years ago when Chen was arrested. Party officials came in and deleted all official photos of Chen. A coworker had given recorded speeches mentioning Chen and how the newspaper was doing great in following his guidance. The speeches were edited on tape to remove all references to Chen.

Living in Shanghai, it's sometimes easy to forget that China is still a totalitarian state. But it's times like these, when China tries to show it's "openness" and "democratic" ways that it really shows how far away it is from a truly free country.

Chinese design falls a little short

I volunteered to help our recruiting team a few weeks ago, and in gratitude, they gave me a "really nice" wallet. Truth be told, it's pretty good quality leather, has the firm name embossed on the front, and is a reasonable size. I had been thinking about using a vertically-oriented wallet since carrying around a substantial amount of cash gets difficult when you put it in a bifold (forget about trifold - you'll end up with a four inch thick lump.)

Anyways, when I actually tried to use it, I realized the design is terrible. Like many Chinese-designed products, it's not quite there.

First off, the pocket for cash is difficult to use. The wallet is designed like a traditional bifold, but twice the height. As a result, the pocket for cash is actually just a big pocket, about 8x6 inches. How do you put money in it? Like a traditional bifold, in which case half the pocket is empty, or as two unseparated vertical pockets, in which case the money slides back and forth? Also, if you notice in the picture, the pocket is actually about 1 centimeter too short for Chinese bills (it's even worse for american bills). Am I supposed to use it with money sticking out the side?

Okay, no worries, there are plenty of slots to carry my multitude of VIP cards, prepaid dry cleaning and massage cards, airline membership cards, etc. But yet again, it's just slightly too small. I managed to squeeze my bank card in, but you'll see in the picture that business cards don't fit.

Also, what's the deal with the strap? Are the designers worried that they've made the pockets too big and the cards will slide out? Or did they try to come up with a way to use all the extra leather that they saved from making the other dimensions 10% too small?

Just another example of Chinese design. It can look good, but it's like no one bothered to try using it before making a few thousand and dumping it on the market. For now, it's going to go up on the shelf next to my Chinese stapler that is 1 inch long and holds 15 staples.

Funny signs

Okay, I finally got around to downloading some pictures off my cameraphone. Here are two gems that snapped of signs that I found downright funny. I know they are hard to read; click on the pictures to enlarge them.