Take Stock of 5 Events That Effect China’s Automotive Development in the Last Half Year Of 2018

As the last 6 months of 2018 passes, we could see there are endless events happened in China’s automotive industry. Some of them are related to the national economy and people’s life, while the other has significant impact to the whole industry. Our reporter draws 5 important events that happened in the last half year. Each of the matters is worth to recalling the attention.

1.Geely Group becomes the largest shareholder of Daimler AG

24th Feb of 2018, Geely Group purchased 9.69% voting share of Daimler AG through it overseas corporate entity company.

In response to why Geely Group invest in Daimler AG, the President of Geely Group, Mr. Li Shufu said:” the global automotive industry is facing a great change nowadays, which creates lots of huge opportunities and great challenge. If we try to catch the opportunities, then we need to cooperate with our peers, work together to occupy the high ground of technology, especially the digital and online techonolgies.”

2.The stock share of automotive company will put the release schedule in 2020, which means there are no limit of the stock share at that time

17th April, China formally set a time limit for the lifting of restrictions of the proportion of stock share in the automotive industry. 

The relevant people judge that in the context of the efficiency and the scale improvement of China’s automotive industry, the stock share liberalization is good for promoting the technology, attracting the foreign companies to enlarge the scale, and encouraging to simulate more advance tehcnologies to be integrated with China’s companies. 

3.The import tariff of the whole vehicle was reduced to 15%, parts of the automotive company’s sales may cut by half.

On 22nd May, the Ministry of Finance announced that, in order to further expand the reform and opening up, push forward supply-side structural reform, promote the transformation and upgrading of the automotive industry, and meet the people’s consumer demand, the import tariff of whole vehicle and automotive parts will be reduced from July 1, 2018. 

It is understood that tariff reduction is one of the important measures for China to establish a fair and open the vehicle market in accordance with the plan. However, there is a gap of less than 2 months between the announcement of tariff reduction policy and the specific implementation, during this gap period, consumers who are interested in buying will hold the money and wait, and the sales of import luxury brands vehicle may drop in these two months.

4.Tesla build factory in China may affected by the change of the trade war between China and America

10th July, Tesla and Shanghai jointly signed the investment agreement of pure electric vehicle project. According the agreement, Tesla will build a super factory in Lingang District of Shanghai, which integrates research and development, manufacturing, sales and other functions, with an annual production capacity of 500,000 pure electric vehicles. In the future, the super factory will not only produce the battery, but also put into production Models 3 and crossover Model Y. The plan is scheduled to be completed as soon as 2020.

This means that the super factory build in China of Tesla, not only is the first overseas factory, but also the first new energy automotive company to enter China as a sole proprietorship.

5.China and Germany will promote to make the standards together of automatic internet, the automotive cooperate will turn to intelligence.

On July 9, 2018, the State Council Premier Li Keqiang , and German Chancellor Angela Mekel jointly hosted the consultation between the Chinese and Germany governments at Berlin Chancellery, and witness the signing of 22 bilateral cooperation projects including agriculture, education, chemicals and automotive cars. As one of the important direction of the 22 cooperation project between China and Germany, the cooperation and planning of automotive industry will become an indispensible part of both sides promoting the development of bilateral economic, trade and investment cooperation. 

Source: .caam.org.cn