Since China's accession to the World Trade Organization at the end of 2001, China's auto industry has reached a million-dollar level every year, becoming the fastest-growing automobile industry since the founding of the People's Republic of China. Compared with Europe and the United States, where the automobile industry is developed, China's auto industry has presented some of its own characteristics and is also facing some problems that need to be solved urgently. The reporter interviewed Dr. Xing Wenjun, editor-in-chief of the English version of the “Chinese Auto News†for the global issue. Dr. Xing Wenjun has been working in the automotive media for 12 years. Since 1994, he has registered an independent publishing company specialized in research and reporting to the world about the Chinese automobile and motorcycle industry publishing and consulting companies in Massachusetts. With his international resume and unique vision, he independently observed, analyzed, studied, reported, publicized, and commented on the Chinese auto industry. In the interview process, Dr. Xing Wenjun mentioned the most, that is, "waiting for the market to fully release."
Incomplete market competition
Dr. Xing Wenjun said that compared with the auto industry in Europe and the United States, the market competition in China's auto industry is incomplete. In the development process of China's auto industry, there is government control, and there are also monopolies in enterprises. Dr. Xing Wenjun did not fully agree with this situation. He believes that in the early stages of the development of the automobile industry, foreign investment is welcome, and it is absolutely necessary for the government to impose restrictions on foreign capital. If there is no restriction at all, it is very difficult for China to make its own car brand. At this time, the restriction of this policy just protects the domestic enterprises. However, with the development of China's auto industry, the government's control has limited the market's complete competition. Some private enterprises will be subject to domestic policies during the development process, leading to incomplete market competition. Therefore, Dr. Xing Wenjun believes that the government's control can only be said to be a double-edged sword for the development of the Chinese auto industry.
China's auto market is not yet a consumer market
The development of China's auto industry has not yet become the consumer's auto market. Compared with Europe and the United States, China is still taking the road to the consumer market. Taking China's car market as an example, a large number of vehicles are still serving official and business services. Dr. Xing Wenjun believes that although most vehicles are purchased on their own behalf, this does not mean that China is already the consumer's automobile market. In fact, some of the cars purchased by individuals are still serving official business. Today, China’s auto market is gradually shifting from the purely official car market to the consumer market in the past. Therefore, China's auto market has great potential. Dr. Xing Wenjun said that for companies and multinational companies, who can see the market prospects and who will succeed, otherwise they will encounter problems.
One problem related to the Chinese auto market is not the consumer market. It is that today's autos cannot be regarded as consumer goods in our country. Although global luxury cars are sold in China, most of them are purchased by people with higher levels of domestic consumption. The car is a symbol of status and status in China. However, in developed countries, automobiles have become personal consumer goods, not a symbol of status. According to international statistics, when the per capita GDP reaches 3,000 U.S. dollars, the family car will reach the blowout state. Taking into consideration China’s actual purchasing power, Dr. Xing Wenjun predicted that when the per capita GDP of China reaches US$2,000, the household car ownership in China should approach the level of US$3,000 per capita GDP in developed countries. Therefore, with the development of China's automobile industry, cars will gradually become consumer products like bicycles and television.
Because China's auto market is not a complete consumer market, China's auto industry is still underdeveloped in marketing, after-sales and other post-market. Take the used car market as an example. The sales of used cars in Europe and the United States account for 70% to 80% of the sales of vehicles. In China, the sales of used cars only account for about 20% of the total vehicle sales. Dr. Xing Wenjun analyzed that because the total amount of automobile production and sales in China has not reached a certain level, the used car market is difficult to develop. However, when the car becomes a real consumer product, most people should buy a used car for the first time. At that time, the used car market should gradually develop.
In addition, China’s auto consumption market has not yet matured, and the insurance-related and credit markets related to automobiles have not been sufficiently developed. Especially in the area of ​​auto consumer credit, there is a lack of relevant personal credit systems and related policy guarantees. As a result, auto consumption credits have encountered difficulties in actual operations, and development has stagnated.
Encouraging independent development should also be considered in the market economy.
Automobile manufacturing is very important to the industrial development of the entire country, and the concept of encouraging independent development is very correct. Dr. Xing Wenjun said that China has a vast market and vast purchasing potential. This is a prerequisite for independent development. China's independent development in the truck sector has been without interruption. However, in the field of cars, there has been a lack of self-development capabilities. With the complete liberalization of the market, Dr. Xing Wenjun believes that the state should grant state-owned enterprises, joint ventures, and private enterprises equal treatment without regard for intellectual property, taxation, etc., and encourage the independent development of cars.
Dr. Xing Wenjun analyzed that the reason why the independent development of China's car industry starts with economical cars is that self-development will create competition. China's auto companies have great advantages in labor costs and resource costs. Therefore, in the area of ​​economical cars, Has a greater competitive advantage. For foreign manufacturers, the high cost and low profits make their interests in the economical car field limited, and they are reluctant to get involved. To develop independently can only do things that others can't do, so the autonomous development of the car field naturally starts with the economical car field. Although economical bicycles have low profits for bicycles, they can be mass-produced, and they cannot fully assume that there is no profit in the self-development of economic cars. Dr. Xing Wenjun also said that with the development of China's auto industry, domestic self-development will inevitably be like Japan and South Korea's auto industry, gradually entering the high-end car.
Once industry insiders believe that independent research and development should rely mainly on private enterprises like Geely. The Chinese side of the domestic automobile joint venture company cannot be the main force relying on self-development because it is constrained by foreign parties. Dr. Xing Wenjun believes that independent development should be the common task of all auto companies, regardless of joint ventures or private enterprises. He believes that with the complete liberalization of the market, the external attitude of the joint venture company for domestic self-development will change, and the way to continue to charge high technical trade fees to China will have a negative impact on the development of both parties. The exclusion of foreign companies from joint ventures for domestic self-development will gradually change as the market liberalizes.
Mergers and reorganizations must follow the needs of the market
Looking at the merger and reorganization road of China's auto industry, there have been a lot of government intervention. This shows that the merger and reorganization of China's auto companies is not entirely in line with market development in accordance with market demand. However, people are gratified that in recent years, government intervention has become less and less. Dr. Xing Wenjun believes that in the future, the government’s intervention in the merger and reorganization of auto companies should be reflected in safety, emissions, and other aspects. The market access standards should be checked and the market should be further liberalized. In the course of mergers and reorganizations, what kind of approach should be taken is whether they are strong and strong, whether they are large or small, or if they are small, they should all be in accordance with the needs of the market. The final result will change the situation of so many vehicle manufacturers now, and form a pattern centered on several big groups.