Yang Jian, executive editor of "Automotive News·China", recently commented that "Does multinational auto companies split up with their partners in China?" (Will global automakers break away from their Chinese partners?), predicting stocks than opening up. Fuel Vehicle,Mini Gas Car,Miniature Gas Cars,Miniature Gas Powered Cars JIANGSU ELEGANCE VEHICLE CO., LTD. , https://www.mawayra-ev.com
According to Chinese regulations, foreign-owned car companies are not allowed to hold more than 50% of shares in China with their Chinese partner joint ventures.
But this may change. Since President Xi Jinping took office last year, he has repeatedly promised to support China's economic development by opening up the domestic market.
A spokesperson for the Ministry of Commerce last year said that the government may loosen restrictions on the 50% share ratio of foreign-invested companies in the future.
China is already a member of the WTO WTO and is negotiating a series of free trade agreements.
Similar to the Pan-Pacific Partnership Agreement TPP, which is currently negotiating with the US and other countries, will eventually lift Beijing's restrictions on the operation of foreign-owned car companies in China.
The question now is: If allowed, will multinational auto companies leave their partners in China? If BMW accurately reflects the idea of ​​a multinational car company, the answer is “noâ€.
The German luxury car manufacturer announced that it will extend its 50:50 joint venture with Brilliance Auto until 2028.
BMW is actually not in a hurry to do so because the current agreement will not expire until 2018. So why does BMW update the partnership four years in advance?
Obviously, BMW recognizes that the joint venture in China is operating very well. In the first five months of this year, the BMW Group sold 185,000 vehicles in China, a year-on-year increase of 25%.
China has become BMW's largest market in the world, but BMW still needs to challenge Audi's title in China's luxury car championship.
If BMW wants to catch up with Audi in China, the most realistic way is to collaborate with existing partners instead of parting ways. BMW's joint venture is expanding production capacity and launching more new cars. So why destroy the good status quo?
In fact, BMW is not the first multinational car company to update the validity of its joint venture in China. In 2012, the Volkswagen Group extended the term of the joint venture with SAIC and FAW Group in China until 2032.
BMW will naturally not be the last multinational car company to extend its partnership.
China is a key market for most multinational automakers. The most reluctant thing for foreign automakers is the uncertainty in their business in China.
Therefore, it can be basically confirmed that other multinational auto companies will follow the footsteps of BMW and update their partnerships in China.