The domestic system
People’s Republic of China as it is formally called has always been working hard to empower the industry. The economic planners here are trying hard to strengthen the industrial background of China. This is the reason why China produces the largest amount of cars. But the problem is that these cars are utilized domestically. Thus Chinese Car Brands have not been able to create a niche for themselves in the international market. The basic reason behind this utilization is the huge population which puts pressure on the industry.
History of Chinese cars:
In China all the industries which are working today to produce were projects funded by USSR. With the fall of USSR the production of Chinese cars further declined. It started growing in the period of early 1990s. By entering WTO the industry strengthened even more. The present problem is still the same-Chinese car brands are popular and utilized more in China and very less at the international level. The industry of Chinese Cars is said to grow much more till 2030.
Features of Chinese car brands:
Chinese car brands are always striving hard to produce cars. The various features of Cars produced here are:
- Low Quality: The cats produced in China are not made with a good quality rather they are made cheaply.
- Less safety features: Most Chinese cars don’t have safety features. The companies do not invest in car safety features.
- Most cars produced by joint ventures: Most international brands like Toyota, Ford, Suzuki, and Mitsubishi have been making joint ventures with native industries to produce cars.
Major native Chinese players:
The Chinese automobile industry has only one native automobile producer. Rest all others are mostly joint ventures with International brands. This native industry producing cars in China is China Association of Automobile Manufacturers. The other brands are mostly international. The international brands create joint ventures because of the large population and the large demand of cars that is present here. The native industrial group makes cars under several brands. Most of these brands are popular domestically and not internationally. They satisfy the demands of people in indigenous manner and less or no exports are made.
Thus the industry has to survive a large competition as well as the large population problems. The industry has to be strengthened by native plans which can provide extensive support to the industry. Exports should also be pushed in order to help the industry flourish. Most international brands having joint ventures should be pushed to increase exports of China. With the increase in exports the Chinese automotive industry can get better results and a better hold of the international market. This can make it even combat the top automobile producers like China and United states.
China thus requires much large planning that can lower the indigenous demand. Also there is a need to push the industry and exports. With these efforts China can definitely move up in the list of top automobile producers.