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Release time:2017-02-02

FOREIGN CAR COMPANIES IN CHINA Smart Car in China Foreign-origin brands, most of which are manufactured in China through joint ventures, accounted for 64 percent of total sales in 2010, according to the China Association of Automobile Manufacturers. As of 2009, foreign car companies held 85 percent of the Chinese car market. GM was the No. 1 auto maker in 2009. Volkswagen was No. 2. GM sold a record 1.83 million units in 2009 In the 1980s, foreign automakers were allowed to form joint ventures with state-owned Chinese partners with foreign ownership limited to 50 percent. The goal of the government was to develop a car industry quickly, learning from the foreign companies how to make cars while maintaining control of the car industry. Volkswagen and American Motors were the first. VW came and built the Santana model to serve the envisioned need for taxis. American Motors came and built Jeeps. Originally, they thought that this would be a good model given China's rural infrastructure. The American Motors/Beijing Auto Works #3 was the joint venture that formed the basis of China's Joint Venture Law. Every one made out well in part because competition was strictly controlled. Volkswagen was the first foreign company to build a plant in China. Now it seems like every major auto company as a presence in Chinese. Mercedes-Benz, Ford, General Motors, Suzuki, Daihatsu, Honda, Subaru, Citreon Toyota all have plants in China. The majority of them have partnerships with one of China's "Big Three” automakers Initially the market in China was still too small for economical high-volume production and many components had to be brought in because components made by local manufacturers are not very good quality. These problems are no longer the case. Still, there are laws prohibiting the sale of foreign cars on the same sales floor as domestic cars. In the early days the general feeling was invest heavily or be left behind. Most companies have tried to carve out a market share and position themselves for the future. Competition is expected to fierce with more losers than winners. So many foreign car companies have entered the fray that even for the winners profits have been cut to the bone. The companies hope to make the most profits by selling compact cars priced between $12,000 and $16,000. Rules for Foreign Car Companies in ChinaForeign car companies in China are required to former a partnership with a Chinese company to do business in China. Before making a deal for a joint venture, Chinese insist on a willingness to transfer technology to China and employ Chinese in upper management. Many companies initially balked at the idea of transferring technology but have since gone along with the scheme to enter the Chinese market. Beijing requires foreign automakers in China to operate in joint ventures, in hopes their local partners will learn and grow. But communist leaders have been disappointed with the results: Today, China's market is dominated by General Motors Co., Volkswagen AG and other foreign brands. Local producers such as Chery Automobile Co. and Geely Holding Group, the new owner of Sweden's Volvo Cars, are growing fast but are far behind. Websites and Resources Audi Sports Car in Hangzhou Good Websites and Sources: China Car Forum Automaker List chinacarforums.com




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