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Essence of the New Model of Joint Ventures in China's Automobile Industry

Jul 19,2013

By the Research Department of Industrial Economy, the DRC and compiled by Shi Yaodong

Research Report No 120, 2013

Abstract:

Joint venture automobile firms have been a strong force driving the development of the automobile industry in China over the past 30 years. In a new phase, with the car industry's focus strategically changing from quantity to quality, joint ventures will take on new meanings.

The cooperation in the automobile industry should shift from producing vehicles with joint capital to joint development. It also needs to extend to wider services such as car rentals, sales, automobile insurance, design and R&D, and maintenance. Not only is it important to invite big-name foreign carmakers to invest in China, Chinese local producers should also go global to tap overseas markets.

Foreign and domestic-funded enterprises, carmakers and parts enterprises, as well as traditional carmakers and high-tech firms, should create diverse cooperative models to take the lead in clean-energy cars and form a strategic alliance featuring joint development and shared interests.