Infringement of foreign capital indirectly harms China's auto industry

● Wenkai Chen: President of Gasgoo.com

● Cui Dongshu: Although the deputy secretary-general of the National Passenger Vehicles Association has begun to slow down this year and entered the adjustment period, this has not prevented foreign automakers from increasing their investment in China and controlling the pace of sales channels. Recently, whether the increase in shareholdings, the repurchase of shares and the establishment of new sales companies, the protagonists are strong foreign car giants, which in turn will give Chinese auto joint venture partners and the Chinese auto industry what impact?

Reporter: Why did the joint venture car companies change their equity concentration this year?

Chen Wenkai: From the current perspective, it feels that the development of joint-venture car companies has reached a new stage. Initially, when the foreign party first arrived in the Chinese market, it may only control R&D technology and finance, as well as production management. Marketing and channel sales allow the Chinese to take responsibility. With the deepening understanding of the Chinese market in foreign countries, foreign parties have begun to participate in the operation of joint-venture car companies in all directions. The market and marketing that China was responsible for have also been dominated by foreign parties. Correspondingly, China’s right to speak is getting smaller and smaller. .

Cui Dongshu: Foreign capital recovery is a normal trend. After all, the core of market dominance is capital control. The position of the foreign party in capital control determines that they will recover more right to speak and income. . The Chinese market is already the world’s largest auto market. It contains huge profits. Some joint venture companies can create more than 10% of profits, and they are sustainable profits. Foreign companies will certainly fight for it, especially for listed companies like General Motors. Winning more recognition in the capital market will surely compete for the benefits that the joint venture believes it deserves.

Reporter: What has changed in the role of the Chinese in the joint venture?

Chen Wenkai: At a certain stage of market competition, the foreign companies in the joint-venture vehicle enterprises are already familiar with the new market environment and no longer rely on the Chinese side to lead the way in the market. The value of the Chinese side is getting smaller and smaller. In addition to the Chinese policy, we can obtain a certain degree of support. With support, the role of other parties is getting smaller and smaller. To put it bluntly, China has become a partner with foreign companies doing business in China. The president of a multinational car company has publicly stated that the Chinese joint venture partners in the joint venture car companies have almost no role.

Reporter: Who has the greatest influence on the income of foreign companies?

Chen Wenkai: Potentially speaking, foreign capital gains influence on independent brands. At present, this giant alliance between multinational giants and state-owned enterprises may lead to a decline in the Chinese auto industry. Foreign parties not only control profit and technology, but also take away profits from their sales. In the process, China appears as a migrant worker.

Cui Dongshu: Foreign power gain will not only affect Chinese joint venture partners, but also will have a significant impact on the development of China's auto industry. For Chinese partners, this means that profits and discourse power will decline. As foreign parties continue to increase investment in the Chinese market and their market competitiveness is stronger, they will also pose threats to the development of self-owned brands, and the space for the development of independent brands will become narrower and narrower.