Auto Industry in China

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Department of Languages & Intercultural Education
Exploring China 331


Can Chinese cars sweep the globe?
Competitiveness of China’s auto industry

Name: Chang Deng
Student ID: 14068678
Lecturer: Dr Grace ZHANG
Date of Submission: 16/3/2001
Word Count: 681

Literature Review
The automotive industry is regarded as a flag of a nation’s economic progress, unique in its far-reaching influence on the development of numerous related core industries, such as a steel business and a plastic industry (Maxton and Wormald 2004, 1). The research conducted by Domansky (2006, 13)point out that the minimal requirements for a country succeed in automotive industry including a GDP of US$500 bn, a population of 50 m, and auto production volumes of 2 m per year. Following this measurement, (The long road 2007, 1) states that China satisfy all the requirements and exceed them to a large extent, but that is because the majority production volumes come from joint-venture firms rather than domestic firms. This statement seems is out of date. According to Jian(2010), China has already became the largest automotive market in the world, and approximately 52%(5.9millom) sales from domestic automakers.

According to Yang (1995 115), the competitiveness of manufacturing sector is a broad of multi-dimensional concept that includes many aspects such as quality, efficiency, price, productivity and environment. In this section, various studies on China’s automotive industry are reviewed that embrace competitive advantages and challenges, and strategy.

One competitive advantage of China’s automotive industry is strong political and financial backing from its government who strongly encourages Chinese carmakers involving global competition (Alysha 2008). In addition, Zhao and Lv (2009) point out that China’s core strengths in global competition are cheap labour cost and a large number of young, well-educated and motivated workforces....
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