|  NEW 
                          YORK, Aug 2 (Reuters) - For most American shoppers, 
                          "Made in China" may still suggest cheap toys, 
                          but China's largest household 
                          appliance 
                          maker has ambitious 
                          plans to change that with its sales of a growing range 
                          of sleek 
                          minibars.  
  Haier 
                          Group Co., which according to some industry 
                          estimates is the world's second-biggest maker of refrigerators, 
                          is seeking to outflank 
                          America's three major appliance makers by competing 
                          on image rather than price, and by targeting 
                          students in the hope that they will remain loyal 
                          as they get older. 
  And 
                          so 
                          far the strategy, which may signal the way 
                          for future campaign in the U.S. market by other Chinese 
                          consumer products companies, may be working - at least 
                          according to two arms of the world's largest retailer 
                          Wal-Mart Stores Inc.  
 
  "It's 
                          not about whether they're made in China," said 
                          Melissa Berryhill, a spokeswoman for Wal-Mart's 
                          Sam's 
                          Club, whose last holiday season catalog 
                          featured a black Haier cooler with smoked glass doors 
                          that is big enough to chill 
                          30 bottles of wine.  
 
  "They're 
                          an exceptional value," she said of the $300 luxury 
                          machine, sold along with the more ordinary Haier chest 
                          freezer that costs about $160.  
 
  Wal-Mart's 
                          main discount operation in April began selling the chest 
                          freezers in half of its 2,600 stores, while most of 
                          its stores sell at least one of two versions of compact 
                          refrigerators made by Haier. 
   "They're 
                          popular and beating our expectations on sales," 
                          said Wal-Mart spokesman 
                          Rob Phillips, who added that the Haier 4.6 cubic 
                          feet and 5 cubic feet freezers cost about the same as 
                          General Electric Co.'s comparable 
                          products, selling for around $169.  
 
  COLLEGE 
                          TOEHOLD GE, 
                          Whirlpool 
                          Corp. 
                          and Maytag 
                          Corp. currently dominate 
                          the U.S. marketplace for household appliances but they 
                          tend to focus most of their attention on mainstream 
                          areas such as large refrigerators and freezers.
  
 
  Haier, 
                          which says it currently sells $200 million worth of 
                          appliances in the U.S. annually, now claims more than 
                          a 35 percent share of the U.S. market for refrigerators 
                          4 cubic feet and smaller - the minibars found in hotels 
                          and college dormitories.  
 
  "When 
                          those college kids 
                          using our little refrigerators grow up and marry, we 
                          want them to be thinking of us for their first fridge," 
                          said Michael Jemal, Haier America's president, who was 
                          Haier's first U.S. distributor before setting up the 
                          unit in 1999.  
 
  Haier 
                          may need to depend less on the Chinese market because 
                          it is likely to face an increasing challenge on its 
                          own turf. 
                          China's entry into the World 
                          Trade Organization will open 
                          up Chinese manufacturers to 
                          greater foreign competition at home.  
 
  Haier, 
                          which had global revenues 
                          of $5 billion last year, spent $30 million setting up 
                          a plant late last year in Camden, South Carolina that 
                          will make large Haier brand refrigerators. Company officials 
                          say they hope initiatives like that will grow U.S. sales 
                          to $1 billion by 2004.   "They're 
                          building up their learning curve 
                          in the U.S., and then picking up niche 
                          markets," said Ming-Jer Chen, a professor at the 
                          Darden School of Business Administration at the University 
                          of Virginia and the author of a new book, Inside 
                          Chinese Business. 
  BROADWAY 
                          HEADQUARTERS The company, whose Chief Executive 
                          Zhang Ruimin is famous in China for being filmed smashing 
                          sub-standard products with a hammer, last week bought 
                          a historical bank building on Broadway in Manhattan 
                          for $14 million.
 
  "Buying 
                          a New York building for $14 million is not what's going 
                          to make us," said Jemal. "It's about offering 
                          the customers the products the competition doesn't have." 
  In 
                          the third quarter of 2002, for example, the company 
                          plans to launch stainless 
                          steel Internet-linked appliances with Flash 
                          Gordon stylings, such as a home clothes washing 
                          machine that can be started via the Internet, he said. 
  To 
                          grow its brand in the U.S., the company has taken out 
                          ad space on 
                          a case-by-case basis 
                          on trolley 
                          cars at JFK 
                          International Airport in New York and on 
                          billboards 
                          in Miami and Chicago, but has not yet contracted 
                          with any of the big advertising firms. And Haier America 
                          is not only battling rival appliance makers in the U.S. 
                          - it is also manufacturing for some of them. As OEM,Haier America 
                          does about 20 to 25 percent of its manufacturing on 
                          a contract basis for other companies, including big 
                          U.S. competitors, who sell its products under their 
                          own brand names. 
 ↑TOP                                               (717 
                          words) |