Holiday Special: Subscribe for $1.52/week.
CHARLES CHILD

In China, the business of government is … business

So General Motors has sold Nexteer Automotive -- its 6,000-employee producer of steering parts -- to a Chinese company.

Here's the interesting part: The buyer, Beijing E-Town International Investment & Development Co., is an arm of Beijing's powerful municipal government.

In China, the opaque and Byzantine relationship between business and government leaves many Western businesspeople scratching their heads. But for the Chinese, it's business as usual.

In the West, companies rely on the rule of law to provide a predictable investment climate. In China, business executives rely on government sponsors -- not laws -- for the confidence and capital to make major investments.

That's why government agencies play a major role in the Chinese auto industry, both in China, of course, and as Chinese automakers and suppliers expand overseas.

25

Shares

ATTENTION COMMENTERS: Over the last few months, Automotive News has monitored a significant increase in the number of personal attacks and abusive comments on our site. We encourage our readers to voice their opinions and argue their points. We expect disagreement. We do not expect our readers to turn on each other. We will be aggressively deleting all comments that personally attack another poster, or an article author, even if the comment is otherwise a well-argued observation. If we see repeated behavior, we will ban the commenter. Please help us maintain a civil level of discourse.

Newsletters