Automotive Industry: Industrial Policy Impedes Industrial Development


On November 12, the Regulations for the Implementation of Auto Finance Company Management Rules was formally promulgated and implemented. Following the implementation details of the "Administrative Measures for Auto Finance Companies" on October 3, it means that the establishment of China's auto finance company has entered the actual operation stage. This is just the forerunner of the “storm” of China’s new automobile policy. In the coming months, it may be the period when most of the new policies of the Chinese automobile industry have come out. Information from various sources shows that a number of new policies, such as the Automobile Industry Development Policy, Automobile Consumption Policy, Automobile Brand Monopoly Management Measures, and Auto Vehicle Characteristics Recognition Management Measures, have already emerged. The fact that so many new policies must be issued centrally indicates that there are too many problems in the current policies.
The rules of the game that are not satisfied by all parties "As a bank employee, I am very concerned about the "Administrative Measures for Auto Finance Companies," but as an ordinary citizen, I am more concerned with the "Automobile Consumption Policy." Buy a car and buy it with confidence. We must use it comfortably. Otherwise, wouldn't it be a matter of spending money to buy a crime?" Mr. Liang, who works at a bank in Guangzhou, told reporters.
Mr. Liang’s fears are not without reason. Xu Xiang, who specializes in the analysis of the automotive industry at Nanfang Securities, believes that the issue of auto consumption policy is the biggest obstacle to the development of China's auto industry, especially the car industry. “Before the recall, the Three Guarantees and other systems have not yet been established, the cars that people buy are actually an incomplete product.” Statistics from the Guangdong Provincial Consumer Council show that in the first half of this year, Guangdong received complaints about car consumption. Of the 154 cases, 68 of them only accounted for the quality of automobiles. Xu Xiang believes that apart from the quality assurance issue, there is a major problem that the cost for consumers to buy and use cars is too high. At present, China not only levies 17% of value-added tax on automobile production, but also imposes 5% consumption tax and 10% vehicle purchase tax on consumption. Consumers who buy a car with a price of 150,000 yuan are just three items of value-added tax, consumption tax, and purchase tax, and they need to spend nearly 30,000 yuan. "Is there a use fee. The problem of a single fuel tax has been dragged on for so long. There are other unreasonable fees and a wide range of prohibitions that consumers can use comfortably."
Consumers are dissatisfied with the auto industry's current automotive policy. Miao Tao, general manager of Dongfeng Motor Co., once stated that there are three major dislocations in China's auto industry management. The first is the borrowing of government management and market management. The government's management of the micro market of the automobile is too much and too detailed. It must seize and hold on some projects that should have been managed through market regulation. The market management and the misplacement of departments and local management are divided into sections. There are multi-headed macro management departments such as the National Development and Reform Commission, the General Administration of Quality Supervision, Inspection and Quarantine, the Ministry of Communications, and the General Administration of Environmental Protection. There are also serious local protections. The third is production and consumption management. The dislocation, at present, China's auto industry management is mainly concentrated in the production process, while the policy formulation and management of the consumer chain lags behind, affecting the rapid development of the automotive industry.
The opinions that are even greater are those private enterprises that have been or are planning to enter the automotive industry. A section of Geely’s Chairman Li Shufu’s remark was repeatedly expressed: “Foreigners can do cars in China, but we ourselves can’t do it; we use the country’s money to dry out cars and lose out on debt and equity, and then use ourselves. "The money does not do anything to dry the car!" The approval of auto companies has created a barrier that private companies can't overcome. Dissatisfaction with foreign investment is the requirement for the independent sales of domestic cars and imported cars. Many foreign companies of the joint ventures have spoken fiercely against the “distribution system,” and some domestic car brand stores have even placed imported cars. Booth.
Excessive Protection Cannot Form Competitiveness Jia Xinguang, chief analyst of China Automotive Industry Consulting Development Company, told reporters that the “big three” auto manufacturers are overprotected. This point can be seen clearly in the process of soliciting opinions from the new automobile industry policy. According to sources, the full text of the draft of the draft was issued to the hands of private auto companies. Almost just a bunch of size headings.
"The result of over-protection is a vicious circle. The more protection is needed, the more protection is needed. Without the 50% joint-venture restriction, the so-called 'three majors' will not be able to make up." Jia Xinguang said that although South Korea had also focused on supporting Daewoo, Hyundai, etc. The three major groups, but South Korea's auto industry is export-oriented, the government requires these three major groups must go to the international market to compete, in the localization and export volume and other aspects have strict tasks, can not meet the requirements of the government will Substitution; China's auto industry is import-substituting. The government supports enterprises to earn their own money from their own homes. There is neither domestic competition nor foreign competition. Where does competitiveness come from?
Excessive protection for some people must be at the expense of restricting the development of others. According to Jia Xinguang, the investment and financing system of the automobile industry is the biggest problem. The auto industry has not really liberalized the private capital. On the one hand, the lack of money for state-owned enterprises is extremely poor. On the other hand, private capital cannot enter. As a result, neither aspect can develop, and wasteful opportunities for development are wasted.
The access approval system is a concrete manifestation of this restriction. According to the meaning of relevant departments, the purpose of implementing the approval system for access is to cure the existing “scattered, chaotic, and bad” situation in the auto industry and prevent duplicate construction. On the surface, this argument may be justified. According to statistics, last year a total of 123 vehicle production plants across the country were scattered in 27 provinces, municipalities, and autonomous regions, of which 113 produced less than 10,000; plus more than 500 modified companies with product qualifications, more than 600 automotive companies There are 200 or so little production or even "zero production" over the years. However, some critics pointed out that the most responsible for the repeated construction of the auto industry is precisely the access approval system. How can the access mechanism be opaque, which project can be used, and which project cannot be used? This is not the final say for the market, but more for public relations, and there is no mechanism for survival of the fittest. As a result, many unqualified companies have entered and have not really developed. This has created a large number of "shell resources" deficiencies, and the situation of "scattered, chaotic, and poor" has come from this situation.
There will be competition for development "It is really difficult to formulate an industry policy that all parties are satisfied with!" This is an excuse for participating in the new auto industry policy makers. From April 28, the National Development and Reform Commission issued a notice to societies for comments before the end of May. It has been more than half a year since then and the new industrial policy has not come out.
“The problem now is that the sheep is basically looked like by the 'wolf'.” Jia Xinguang compared the domestic auto companies to the “sheep,” and the “wolf” naturally refers to foreign auto giants. He said that in the current situation, opening up has become a dilemma. If it is not open to the inside now, once it is open to the outside world, these auto companies that have not experienced market competition at all will be vulnerable; if they are open to the outside before opening to the outside world, it is too time for China to fulfill its commitment to join the WTO. Short, when the domestic auto companies have not yet grown up in the competition, foreign auto giants can let go of their hands and ears, but let people get the benefits of fishing.
However, there are different opinions. Someone told reporters that there is nothing really embarrassing at all. Since the competition with foreign automobile giants will be faced with when they are not open to the inside, it would be better to simply let go of the inside first, even if it does not grow up at the moment, but at least there has been a certain degree of competition awareness and experience, it is better than Even the strength of struggling did not surrender to disarm. Besides, the situation after the release is not so pessimistic. It is still too early to draw conclusions.
Although there is news that the new industrial policy will continue to retain the access approval system, and may impose some restrictions on investment, but the trend of outside capital to enter the auto industry is still unstoppable. Since this year, BYD, Delong, Midea and other companies have entered the auto industry through backdoors. In Zhejiang, where the auto parts industry and the private economy are more developed, a boom in private enterprises called “marshalling” is being vigorously launched. According to news from Xinhua News Agency, the National Development and Reform Commission has already received applications from 40 Zhejiang private enterprises, including Oaks and Bird, to obtain qualification for vehicle production. A survey released by the Zhejiang Industry and Commerce Federation recently revealed that there are 28 companies in Zhejiang that have entered the vehicle manufacturing industry.
Another noteworthy news is that in response to the need for market competition, SAIC Motor Corporation organized its entire vehicle and parts companies, such as Shanghai GM and Shanghai Volkswagen, to form a joint task force with Tongji University to conduct a comparative study of Chinese and foreign auto recall systems. At the same time, various companies set up a car recall team to set up three systems, including early warning of quality, information management, and product traceability systems, in preparation for the implementation of the “recall” in the future.

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