Foreign automakers are being warned not to rely heavily on
exporting to the fast-growing Chinese market in the wake of the
country's entry into the World Trade Organization (WTO).
According to the China Trading Center for Automobile Imports, the
nation imported 39,405 vehicles during the first five months of
this year. Last year, China's vehicle imports totalled just 72,000
units.
Ding Hongxiang, deputy general manager of the center, attributed
the growth to China's auto tariff cuts at the beginning of the
year, allocation of new quotas to importers in April and increasing
demand for imported vehicles in the domestic market.
"However, those foreign automakers who want to depend on exporting
to China will ultimately fail on the market," Ding said.
The Chinese auto market is so big that it cannot depend primarily
on imports, he said.
The government will continue to control vehicle imports and protect
local manufacturers through non-tariff measures, he said.
"The imperative for foreign automakers is to increase investment in
China and swiftly bring new products into their Chinese joint
ventures," he said.
Coveting huge potential on the Chinese market, foreign automakers
have recognized the increasing importance of investing and local
manufacturing in China.
German auto giant Volkswagen Group, which controls more than 50
percent of the Chinese passenger car market through its two joint
ventures, has announced that it will invest US$2.5 billion more
over the nation in the next five years.
Germany's BMW will soon get the green light from the Chinese
Government to set up a manufacturing joint venture in China.
DaimlerChrysler, which has a jeep joint venture in China, announced
last week that possible passenger car projects with Mercedes-Benz
in the nation "could not be ruled out."
Italy's Fiat Auto has also planned to bring three new models into
its Chinese joint venture by the end of 2003.
Domestic manufacturers appear not to be greatly influenced by
increasing imports.
During the first five months of this year, sales of domestically
made vehicles amounted to 1.28 million units.
The State Economic and Trade Commission (SETC) said last week that
profits of China's 15 key State-owned automakers increased by 10.60
percent year on year to 6.21 billion yuan (US$750.7 million) during
the first five months of this year.
China's passenger car imports from January to May amounted to
23,551 units, according to Ding.
China imported 22,408 vehicles from Japan and 5,580 units from
Germany during the period.
Among the total imports during the period, 18,214 vehicles came
with 1.5- to 2.5-litre engines.
In
January, China cut its tariffs on auto imports from as high as 80
percent to as low as 43.8 percent.
Under WTO obligations, the tariffs will decline to 25 percent by
mid-2006.
(China
Daily July 1, 2002)