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Chinese Automotive Industry Has Prevailed Globally for Three Consecutive Months, Industry Adjustment Has Brought Initial Success

Source: Author£ºadmin Hits£º9484 Time£º2009/7/6 10:10:57

Even though international financial crisis continues exerting impact on global automotive industry, China has surpassed the United States for three consecutive months in terms of car sales volume and became the largest car market in the first quarter in 2009, achieving unique excellence among declining peers. With the favorable momentum, the 13th Shanghai Auto Show came back with high profile and has recently became the largest one among various auto shows in China and the large international auto show with the most intensified presence of car traders. Thus Wan Ji Fei, Chairman of China Council for the Promotion of International Trade, believed that Shanghai Auto Show had taken the lead in the global Grade A auto shows and was expected to become the most influential international auto show in the world this year.

The cloud in the west may be accompanied by a silver lining in the east.

The automotive industry in the real economy is hit hard by international financial crisis, however, Shanghai Auto Show exhibits unique confidence under the extraordinary environment. Journalists witnessed a strong lineup of international automotive enterprises, joint venture brands and independent brands in 20 and 21 the two open days for media such as Rolls-Royce RR4 new series models named Ghost, Beijing Hyundai fashionable double-box car i30 to be launched in European market and the first independently developed model BT01 and independent brand Geely’s six new models globally launched for the first time which are the fruits resulting from Geely’s strategic transformation. According to Zhao Fu, Vice President of Geely, this referred to the result of being discounted at 30% and nine models were initially planned.

International automotive enterprises bet on China, independent brands have their competitive edge sharpened; both domestic and foreign cars gain unabated momentum. Crisis can’t be seen in the fast-growing Chinese car market, ten new models will make their debut this year and in the next year and we have fully prepared for the development of Chinese market, said by Chen Shi, Vice President of GM China. In the past, the west enjoys prosperity in automotive industry while not in the east, but now self-efforts and the sweeping financial crisis create the scenario in which prosperity previously in the west shifts to the east. Despite the unfolding financial crisis last year, international automotive enterprises such as GM, Ford and Volkswagen posted increasing results (even grew less) in joint venture and cooperation in Chinese automotive industry, which makes the extraordinary energy and bright future of Chinese car market much awaited globally.

Crisis enables China to accelerate adjustments.

Thriving Shanghai auto show does not make insiders get carried away, they are still exploring the way to chart the course of developing Chinese automotive industry amidst global financial crisis. On the eve of the auto show, in 2009 Shanghai International Automotive Summit under the theme of The Challenges and Opportunities for the Development of Automotive Industry amid Global Economic Crisis, Zhang Xiao Yu, Executive Vice-president of China Machinery Industry Federation, pointed out that even if there was no the financial crisis, Chinese automotive industry should also make self-adjustments but the financial crisis heightened the urgency and quickened the pace of self-adjustments.
Chinese car market has been subject to rare negative growth since the third quarter last year, which is partly due to contraction of external demand as a result of international financial crisis and is partly attributable to the conflicts and problems in the development of China automotive industry. According to Hu Mao Yuan, Chairman of Shanghai Automotive Industry Corporation Group, Chinese automotive enterprises outshone its peers in the global arena in the first quarter, however, China has a long way to go to become automotive powerful nation. The current problems in Chinese automotive industry result from not only international financial crisis, the external factor, but also many structural conflicts obstructing the development of automotive industry; concerted efforts is required to make breakthroughs on addressing industry bottleneck.

Hu Mao Yuan has expressed his opinions as to alliance in technical research and development required for China to compete with counterparts in the world and become a powerful nation in the automotive field. He believed that alliance is common despite of competition in products in the automotive industry in the world. Chinese automotive industry should not embark on homogenous research and development even low level of duplication of similar kinds; for example, with respect to research and development of battery technology, the common technology of similar kind can be developed though alliance for tackling key problems with concentrated efforts to reduce input and share outcome.

Hu Mao Yuan emphasized that Chinese automotive industry should proceed from the structure of industry, market, enterprise, research and development to focus on long-term adjustments; combined efforts can also be made to achieve win-win outcome in the automotive industry.
The goal of forging powerful nation through boosting the development of industry should be unswervingly pursued.

In order to shake off the adverse impact from financial crisis on Chinese automotive industry, the Central Government has swiftly responded to take measures by outlining the plans for reinvigorating ten industries with initial attention paid to the automotive industry and the industry’s consumer demand to be stimulated by special fund. Expanding domestic demand and adjusting the structure was the inevitable requirement for further developing Chinese automotive industry, said by Miao Xu, Vice Minister of the Ministry of Industry and Information Technology, in Shanghai Automotive Summit. The State Council has studied and weighed the situation and has formulated and promulgated in a timely manner the plan for adjusting and reinvigorating the automotive industry and has studied and formulated series of short and long-term policies and measures by integrating assurance of growth, expansion of domestic demand and adjustment of structure. As the competent department in charge of the automotive industry, the Ministry of Industry and Information Technology implements the Central Government’s policies and measures for expanding domestic demand, adjusting the structure and maintaining growth by laying stress on adjusting and rejuvenating the automotive industry.

Facilitated by the State’s series of policies for boosting car demand, China saw the end of downward trend of car production and sales in the first quarter. The car sales volume in China rebounded to 2678.8 thousand in the first quarter this year. Lifting car consumption by putting in place the plan for adjusting and reinvigorating the automotive industry has achieved initial success.
According to Miao Xu, it was expected to achieve the goal of 10 million vehicles this year. and ten policies in total would be implemented this years and now several of tem were just made available.

Therefore, as the automotive veteran, Zhang Xiao Yu firmly believes that with the support of series of policies promulgated by the Central Government and the concerted efforts in the automotive industry the growth of automotive industry will continue to be in tandem with national GDP growth, the goal of becoming the powerful nation in the automotive field in the world by 2020 should be firmly pursued.