Jump to content

MyCarForum Logo
Search
Magnifying glass

SEARCH

2

Chinese government to support local brands

By SYF77 on 03 Mar 2012

Attached Image
The Chinese government has issued a list of new cars that can be purchased for official purposes and foreign brands such as Daimler AG (DAI)ís Mercedes Benz and Volkswagen AG (VOW)ís Audi have been delisted. The list published by the Ministry of Industry and Information Technology consist of 412 models and all of them are manufactured by local carmakers.

Attached Image
The reasons cited for the change are that government agencies must reduce their spending costs, cut their energy consumption and minimize pollution. Ok, I can understand that local brands could be cheaper. However, I am not sure if they are more fuel efficient and less polluting than the foreign brands which have more established engine technology.

In the name of cost saving, the Chinese government also mandates that vehicles used for official purposes such as tax collection and criminal investigations must cost less than 180,000 yuan (SGD 35,854) and have an engine less than 1.8L in capacity. In addition, the manufacturers must have spent no less than 3 percent of their core revenue on research and development in the past two years.

This move by the Chinese government might be deemed as protectionistic. We know that protectionistic policies may not help to develop local industries. The local industries may become complacent due to healthy local sales and there is less incentive to improvise their products. Perhaps, some competition is good. In 2008, the Malaysian government decided to end its protection of Malaysia's Proton Motors, which included import duties and taxes levied against foreign carmakers. Proton was also the recipient of tax breaks and other government incentives.

discussions, other news, china and 7 more...

Viewed: 852 times

Related Blog Posts
SYF77
Written by SYF77
I have been a car fanatic since 1989, when my father was changing our family car then to a Toyota Corolla 1.6 GL fitted with a Twin Cam 16 valve engine that was carburetor-fed, a big deal back in those days. The automobile technology and industry fascinates me and I hope to broadcast these interesting developments to everyone out there through this blog.



  • 1
GrandCruiser Jul 28 2012 03:43 PM
Oh come on, isn't American government too? Look like how protectionism have harmed GM so far.
  • 1
 
Car Makes

Please select a car make

Facebook Likes
   Featured Blog Post
Photo
The guide, while not mandatory, comes amid rising car complaints, mainly about defects. It is dev...
POPULAR BLOG POSTS
Photo
Malaysia might be forced to begin charging a daily Vehicle Entry Permit (VEP) fee of S$35 fo...
Photo
While this is not exactly the case in Singapore, many customers around the world saw the opportun...
Photo
Hundreds of Tesla Model S and Model X owners recently gathered in China to set the 'Largest p...
Photo
Car population down four percent as the total number of vehicles shrinks for third straight year....
Photo
With its main rivals all going down the turbocharged route, Lamborghini wants to be special by st...
   Lifestyle Articles
   Tags