|
|
|
Related stories
| |
New Policy Issued for Auto Industry
2004/06/15
The National Development and Reform Commission launched a long-awaited new policy for Chinas fast-growing auto industry on June 1.
The new policy release comes just a year after the commission, one of the major watchdogs for the auto industry, issued a draft policy seeking public opinion.
The new auto policy will substitute for the old one issued in 1994 by the State Council. It will both loosen and tighten restrictions on foreign investors in the auto industry from different perspectives.
Foreign investors will be allowed to control stakes of more than 50 per cent in automobile and motorcycle joint ventures (JVs) with Chinese partners "if their JVs are built in Chinas export processing zones and shoot at overseas markets," the new policy states.
Japan's Honda Motors has a 65 per cent share in a JV with China s Dongfeng Motor Corp. and the Guangzhou Automobile Group.
All cars to be produced by the JV, located in the export-processing zone in Guangzhou in South Chinas Guangdong Province, will be exported.
The new policy will permit foreign investors to create more than two JV plants in China to produce same categories of vehicles, if they join forces with their existing Chinese partners to merge with other companies in China.
General Motors (GM), the world's No 1 automaker, has four car JVs in China through mergers of local companies jointly with the Shanghai Automotive Industry Corp. (SAIC), one of Chinas top three automakers.
Big Chinese automakers will be encouraged to team up with foreign partners to merge both domestic and foreign vehicle producers to" expand business boundaries in line with the auto industrys globalization," according to the new policy.
SAIC in late 2002 joined hands with GM and Japans Suzuki to take over South Korea s Daewoo Motors.
This is the first overseas auto merger involving a Chinese vehicle maker.
The new policy foresees some internationally competitive Chinese automakers joining the ranks of the worlds top 500 multinationals by 2010.
SAIC, which also runs a JV with Germanys Volkswagen, has attempted to become one of the top 500.
"These regulations are in accordance with the auto industrys latest development during the period after China s entry into the World Trade Organization and will speed up the restructuring of the fragmented sector," said Jia Xinguang, an analyst of the China National Automotive Industry Consulting and Development Corp.
There are 120 vehicle plants in China. However, if a foreign automaker controls a relative majority stake in another foreign firm, they will be treated as one entity when it comes to the requirement on the number of Sino-foreign JVs in China, the new policy states.
One Chinese shareholder must have a stake bigger than the total of all foreign investors, if a Chinese listed automobile, motorcycle or other special-purpose vehicle producer sells its corporate shares, according to the new policy.
"The two requirements are intended to protect Chinese automakers through measures not violating the nations commitments to the WTO," Jia said. Foreign automakers appear cautious in their comments on the new policy.
"We are studying the new policy and not yet available for comment," said Ye Wen, a communications manager for Volkswagen's China operations.
The new policy will enhance barriers to domestic non-auto investors in the industry. Automakers in China that "could not maintain normal operations" will be forbidden to transfer their production permits to non-auto and motorcycle enterprises and individuals, it said.
The State will encourage these automakers to regroup assets with other vehicle producers. If an automaker goes bankrupt, its production permit will be removed.
|
京ICPè¯050057å·http://www.miibeian.gov.cn