China's Auto Industry China's Automotive Industry example essay topic

China's Auto Industry Sees Better Trend of Development In 2000, Chinese auto industry will maintain a sustained and high-speed growth, its output will reach 2 million units, including 700,000 sedan cars and 550,000 passenger coaches, and priority will be given to the development of city buses with low decks. It is learned from the news briefing on the 6th Beijing International Auto Industry Exposition, after joining the WTO, Chinese auto enterprises will switch to the manufacture of special-purpose automobiles, the total output of motorcycles will exceed 11 million units, that of vehicle for agriculture will dive, but, influenced by the environmental protection and consumption demand, there will be some improvement in the variety and grade of such automobiles and marked increase in the output of four-wheel vehicles for agriculture. Sources say that in 2000, China will join the WTO and the tide of economic globalization. In the face of the rare opportunity and challenge, Chinese auto industry will carry out a series of adjustment in the aspects of priority development, management method, products mix and the consumption environment, following are the main points: Giving priority to the development of economical cars featuring safety, energy-saving, environment-protection, heavy-duty trucks, passenger coaches and special chassis es suiting the need of safety on expressways, and raising the key part assembling level; Speeding up structural readjustment and reorganization; Managing Chinese auto industry in accordance with the international standard; Encouraging key enterprises manufacturing auto parts and components to cooperate with large economically strong foreign enterprises, so as to increase their development ability and form an economy of scale. Further improving the automobile consumption environment.

China's exports of vehicles grew by 232.2 percent year-on-year to reach 239 million US dollars in the first eight months of this year, according to the General Administration of Customs. This included 18.52 million US dollars from sedans, 8.46 million from off-road vehicles, 9.29 million from minibuses, 28.73 million from buses, 76 million from trucks, and 83.82 million from special-purpose vehicles. Automotive products have become a major part of China's exports of machinery and electrical goods. In addition to complete vehicles, China in the same period exported auto parts valued at 2.74 billion US dollars, of which 2.3 billion from parts and accessories and 404 million from key components. China produced 2.728 million vehicles, up 36 percent year-on- year, and imported a record 9.3 billion US dollars in automotive products, up 94.7 percent year-on-year, in the first eight months of this year. Comment on this article Close China's Auto Industry Development Trend China's auto industry has turned from low growth to high-speed growth in recent 20 years.

Output in 1999 was l. 8303 million vehicles, up l 2.32% over l 998. Sales totalled l. 8325 million vehicles, up l 4.2 l%, Year-end stock totalled l 8 l. 600 million vehicles, up ll.

0 l%. Import and export totalled US$3.556 billion in value, up 25.04%. The industry is expected to continue sustained and rapid growth this year with an expected output of two million vehicles including 700,000 sedans, 550, 00 passenger buses. Low-chassis city passenger buses will be the focus for development. After China's entry into the WTO, more complete vehicle manufacturers will turn towards producing special purpose vehicles. Output of motor cycles will top 11 million and farm-use vehicles will be reduced but will be upgraded in line with environmental protection and consumer demand.

Four-wheel farm-use vehicles will see a marked increase in output. With it's entry into the WTO, China's economy will merge into the tide of globalisation. Faced with this rare opportunity and challenge China's car industry will make re-adjustments focussing on development, the mode of management, product mix and the consumption environment in the following seven areas. Under the l 0th Five Year Plan, the car industry will focus on the development of safe and energy efficient economic-type sedans, heavy lorries, passenger buses and special use car chassis, suitable for expressways. It will also concentrate on improving the standard of key parts and accessories. Stepping up the restructuring and re-organisation for higher centralised production.

To dovetail the mode of management with international convention. The policy for the car industry is to be revised and perfected, catalogue management to be reformed and a product acknowledgement system to be gradually put into practice. Competition between enterprises will be for quality. Management reform, especially technological innovation, will become the main feature in market competition.

The common practice of global purchase and modular supply will urge the domestic industry to produce auto parts and accessories. Producers are encouraged to co-operate with strong foreign partners so as to cater for both the domestic and world market, to improve the ability and to develop into a scale economy. To improve the consumption environment. Cargo transportation worldwide is now mainly by road and lorries.

Domestic medium-sized vehicles can basically meet world market demand and are advantageous in price. According to world market demand, China's export of heavy and medium-sized lorries is expected to increase in 2000, with complete vehicles being dominant. Import is expected to fall, sedans in particular, which are estimated to drop by l 0%-l 5%, following China's entry into the WTO, and with the flow of reasonably-priced new-type domestically produced vehicles onto the market. CHINA: Economic and Auto Industry News CHINA AND WTO MEMBERSHIP China's entry into the World Trade Organization will offer tremendous opportunities for U.S. companies, but there will be some bumps in the road.

"The pace of change in China is stunning. It's absoultely remarkable, but this fast pace change causes other challenges to be met", said Daniel H. Rosen, senior advisor for U.S. international economic policy. "We have to abandon old style management and establish more laws and regulations and enforce them", said Jin Ligan g, China's commercial consul in New York. The best opportunities for U.S. companies will be in distribution.

In the past, foreign companies with joint ventures have faced sever restrictions if they wanted to import goods and sell them in China. They would have to export a certain percentage of the goods they produced in China and sell a certain percentage of goods in China that were produced using local labor and materials. Such restrictions will vanish with WTO membership. China's most important exports include footwear, clothes, toys, home appliances, machine tools, auto parts, hardware and furniture. China's most important imports include agricultural products, aircraft, power generation equipment, oil extraction equipment, electronic appliances, chemical products and machinery.

Trade between China and the United States increased over 25 percent in 2000. The United States is now China's 2nd largest trading partner. U.S. INVESTMENT Direct US investment in China increases annually. China approved 2,301 U.S. invested projects during the first 11 months of 2000. Contractual investment in these projects is valued at U.S. 7.3 billion with U.S. 3.6 billion already invested. U.S. companies invested in the machinery industry, the metallurgical industry, oil processing, electronics, telecommunications, chemicals, textiles, light industry, food processing, the agricultural sector, pharmaceutical manufacturing, real estate, foreign trade and freight agent services.

The United States has been the largest investor in China for three consecutive years. CHINA'S AUTO INDUSTRY China's automotive industry has been maintaining an average annual growth of 24 percent in added value since 1990. This rate is higher than the average rate of the national economy. The proportion of the output value of automotive industry in the national total ranged from 2.1-to-3.7 percent and that of its industrial added value from 1.8-to-2.9 percent between 1990 and 1998. This added value from the automotive industry accounted for over 1 percent of the GNP. China being one of the fastest growing automotive markets in the world, is having a substantial impact on the country's automotive manufacturing and aftermarket.

China launched 444 foreign-funded car part projects by the end of last year, involving investment of US $8.7 billion according to the China Association of Automakers..