China to scrap foreign auto ownership limits by 2022
Skip to main content
Sister Publication Links
  • Automotive News Canada
  • Automotive News Europe
  • Automotive News Mexico
  • Automotive News China
  • Automobilwoche
AN-LOGO-BLUE
Subscribe
  • Subscribe
  • Account
  • login
  • HOME
  • NEWS
    • Dealers
    • Automakers & Suppliers
    • News by Brand
    • Cars & Concepts
    • China
    • Shift
    • Mobility Report
    • Special Reports
    • Digital Edition Archive
    • This Week's Issue
    • China trade
      China sees U.S. postponing Dec. 15 threat as tariff cuts debated
      Dealer
      China auto sales drop for 17th straight month in November
      VW's Jetta subbrand launches with 3-month sales of nearly 30,000
      BYD lands major e-bus order in Netherlands, Colombia
    • Four technologies that could take the world beyond lithium ion
      Many lessons learned -- and some underway -- on battery safety
      Leave room for lead?
      The 3 main types of lithium ion battery cells
    • CEO of GM's Cruise hints at offering low-cost shared rides
      NTSB scrutinizes 'automation complacency' after Uber crash
      Karl-Thomas Neumann joins board of Israeli startup
      Nuro will soon start driverless deliveries in Houston
    • Automotive News special report: Retail Realities
      2019 UAW-Detroit 3 negotiations: The path forward
      Dealerships owned by ex-NFL stars face collapse, litigation
      Want a luxury car? Try a Kia
    • With battery partner, GM eases risk
      Automakers push GPB to sell stores
      FCA and PSA together will be stronger, Tavares says
      Nissan furloughs U.S. employees to save cash
    • Access F&I
    • Fixed Ops Journal
    • Marketing
    • Used Cars
    • Sales
    • Best Practices
    • Dealership Buy/Sell
    • NADA
    • NADA Show
    • Automakers
    • Manufacturing
    • Suppliers
    • Regulations & Safety
    • Executives
    • Leading Women Network
    • Guide to Economic Development
    • PACE Awards
    • Management Briefing Seminars
    • World Congress
    • Aston Martin
    • BMW
      • Mini
      • Rolls-Royce
    • Daimler
      • Mercedes Benz
      • Smart
    • Fiat Chrysler
      • Alfa Romeo
      • Chrysler
      • Dodge
      • Ferrari
      • Fiat
      • Jeep
      • Maserati
      • Ram
    • Ford
      • Lincoln
    • General Motors
      • Buick
      • Cadillac
      • Chevrolet
      • GMC
      • Holden
    • Honda
      • Acura
    • Hyundai
      • Genesis
      • Kia
    • Mazda
    • McLaren
    • Mitsubishi
    • Nissan
      • Infiniti
    • PSA
      • Citroen
      • Opel
      • Peugeot
    • Renault
    • Subaru
    • Suzuki
    • Tata
      • Jaguar
      • Land Rover
    • Tesla
    • Toyota
      • Lexus
    • Volkswagen
      • Audi
      • Bentley
      • Bugatti
      • Lamborghini
      • Porsche
      • Seat
      • Skoda
    • Volvo
    • (Discontinued Brands)
    • Auto Shows
      • Detroit Auto Show
      • New York Auto Show
      • Los Angeles Auto Show
      • Chicago Auto Show
      • Geneva Auto Show
      • Paris Auto Show
      • Frankfurt Auto Show
      • Toronto Auto Show
      • Tokyo Auto Show
      • Shanghai Auto Show
      • Beijing Auto Show
    • Future Product Pipeline
    • Photo Galleries
    • Car Cutaways
    • Design
  • OPINION
    • Blogs
    • Cartoons
    • Keith Crain
    • Automotive Views with Jason Stein
    • Columnists
    • China Commentary
    • Editorials
    • Letters to the Editor
    • Send us a Letter
    • Alfa-Romeo-Stelvio- web.jpg
      Alfa Romeo could be Tavares' toughest turnaround
      Iacobelli
      Alphons Iacobelli: The bad penny that keeps turning up
      With Mach-E, Ford ensures Mustang badge will live on
      Autonomous
      A call for clarity on self-driving terminology
    • view gallery
      1 photos
      Hop On In
      view gallery
      1 photos
      Polarizing Design
      view gallery
      1 photos
      Charging Ahead
      Roger Penske buys the Indianapolis Motor Speedway and IndyCar
      view gallery
      1 photos
      Pace Truck
    • Shifting gears away from the stick shift
      SEMA still a wonderful circus
      Penske still has plenty of races to win
      Ford's turn in the hot seat
    • December 6, 2019 | All-Stars will leave an imprint on the industry’s future
      November 29, 2019 | Plenty to be thankful for in the automotive industry
      November 22, 2019 | GM’s lawsuit against FCA is all about payback
      November 15, 2019 | Will anyone buy EVs?
    • EV hype or reality? Follow the money
      Lindsay VanHulle
      AI changes work at dealerships
      Troy Blackwell
      New ideas needed to lift EV residuals
      Alfa could be Tavares' toughest turnaround
    • EV taxis
      Beijing, unrelenting, steps up push for EV output
      Buick in China
      Global automakers raise bet on gasoline crossovers, SUVs in search of growth opportunities
      American brands, losing ground, face new challenges in China
      PSA, FCA must confront excess China capacity under merger
    • Uber case should prompt tighter AV controls
      Plan to clean up UAW corruption is a good start
      Shared benefits make FCA-PSA union worth risk
      GM, UAW should get credit for working out deal
    • Trabant has been reliable, mostly
      Cadillac needs to get its priorities straight
      Dealers can find out how to follow ADA
      Indeed, Penske did have another win
  • DATA CENTER
  • VIDEO
    • AutoNews Now
    • First Shift
    • Special Video Reports
    • Weekend Drive
    • AutoNews Now: Toyota NA chief Jim Lentz to retire in March
      AutoNews Now: GM, Ford praise USMCA compromise
      AutoNews Now: Cadillac pilots virtual showroom with live agents
      AutoNews Now: Uber discloses 3,000 claims of sexual assault in 2018
    • First Shift: Chevy SUVs get more space, tech, safety features
      First Shift: Workers at several FCA plants vote to approve contract
      First Shift: VW, Toyota push Prime to sell stores
      First Shift: Tesla's China-made cars qualify for subsidies
    • Florida FCA store scores with soft-sell approach in service drive
      Ford's Jim Hackett on Wall Street, the Mustang Mach-E and tech opportunities for dealers
      watch video
      9:13
      Women service staffers defy perceptions, boost customer satisfaction
      Tenn. dealer preaches profits, fixed ops longevity, workplace empathy
    • Why Carlos Tavares wants to merge PSA and FCA  
      Lincoln aims to 'paint a new picture' for shoppers
      VW's Scott Keogh on bringing 'cool' EVs to the masses
      How Toyota found its 'niche' in Mexico
  • EVENTS & AWARDS
    • Events
    • Awards
    • World Congress
    • Retail Forum: NADA
    • Canada Congress
    • Marketing 360: L.A.
    • Europe Congress
    • Retail Forum: Chicago
    • Leading Women Conference Detroit
    • Retail Forum: Toronto
    • Fixed Ops Journal Forum
    • 100 Leading Women
      • Submit a nomination for 2020
    • 40 Under 40 Retail
    • All-Stars
    • Best Dealerships To Work For
    • PACE Awards
    • PACEpilot
    • Rising Stars
    • Europe Rising Stars
  • JOBS
  • +MORE
    • Leading Women Network
    • Podcasts
    • Webinars
    • Publishing Partners
    • Classifieds
    • People on the Move
    • Newsletters
    • Contact Us
    • Media Kit
    • RSS Feeds
    • Shift: A Podcast About Mobility
    • Special Reports Podcasts
    • Weekend Drive Podcasts
    • Ally: Do It Right
    • DealerSocket
    • Deloitte: Cyber everywhere: Preparing for automotive safety in the face of cyber threats
    • Facebook: The road to a zero-friction future
    • Guide To Economic Development
    • PayPal Credit: How consumer financing helps drive sales for online auto parts retailers
MENU
Breadcrumb
  1. Home
  2. China
April 17, 2018 01:00 AM

China to scrap foreign ownership caps on automakers by 2022

Norihiko Shirouzu and Adam Jourdan
  • Tweet
  • Share
  • Share
  • Email
  • More
    Print
    REUTERS
    Workers assemble vehicles at Changan Ford plant in Harbin in March.

    BEIJING/SHANGHAI -- China will end foreign ownership caps on local auto companies by 2022 and will remove restrictions on new-energy vehicle ventures this year, a major shift that will open the market wider to carmakers such as Nissan and Tesla.

    The country will remove limits on companies making full electric and plug-in hybrid vehicles in 2018, commercial-vehicle companies in 2020 and the wider passenger vehicle market by 2022, China's state planner said in a statement.

    The move, which comes amid a trade standoff between Washington and Beijing, signals the end of a rule put in place in 1994 in the world's largest auto market limiting foreign carmakers to owning 50 percent of any local venture.

    The policy was implemented to help domestic carmakers compete against more advanced international rivals.

    Analysts said the main beneficiaries, at least in the short term, would be carmakers focused on new-energy vehicles, including Tesla, which has been seeking to set up a wholly owned plant in Shanghai.

    Tesla chief Elon Musk said last month China's tough auto rules for foreign companies created an uneven playing field as scores of local and international companies compete for a slice of China's fast-growing market for green cars.

    Tesla was not immediately available to comment on Tuesday.

    The looser rules would likely raise pressure on domestic carmakers, potentially hitting local names such as Warren Buffett-backed BYD Co.

    Traditional automakers will need to wait longer for any direct impact and may even see more risks than opportunities in ditching their joint venture structures, said James Chao, Asia-Pacific chief at consultancy IHS Markit.

    "Foreign companies may already be in a box" in China, said Chao, adding the joint venture structure was now so ingrained many might not want to change it.

    "While getting a bigger share could be advantageous in terms of boosting profits, they may actually be already too dependent on their Chinese partners to sever those ties."

    REUTERS

    Tesla and other EV makers emerged as immediate big winners from rules the Chinese government detailed on Tuesday.

    A senior General Motors executive said last week that even without ownership caps the U.S. carmaker would not cut ties with local partner SAIC Motor Corp., adding GM would not be as successful in China on its own. The person asked not to be named because of the sensitivity of the matter.

    GM said last week the company's "growth in China is a result of working with our trusted joint venture partners."

    Japan's Nissan Motor Co. said in a statement it would "monitor how any specific policies develop and will plan accordingly."

    Honda Motor Co. said its China business had grown on the back of strong local tie-ups. "At the moment we have no plans to change our capital relationship," a Honda spokesman said.

    China will also scrap foreign ownership limits in the ship and aircraft manufacturing industries in 2018, the National Development and Reform Commission said.

    The highly symbolic moves in autos come after President Xi Jinping said last week the country would scrap ownership limits "as soon as possible," exciting global auto brands even as China and the U.S. spar over trade tariffs.

    China -- which said the easing of auto rules is unrelated to its trade dispute with the United States -- is keen to portray itself as open for business. Its ties with the world's largest economy, though, are becoming increasingly fraught.

    The United States on Monday banned American companies from selling parts to Chinese telecom equipment maker ZTE Corp. for seven years, creating a new fissure in Chinese-U.S. ties.

    China on Tuesday said it will slap a temporary fee on U.S. sorghum, used as feed meal in China, in a preliminary anti-dumping ruling after a Chinese probe launched more than two months ago.

    Related Articles
    Are China deals U.S. security threats?
    GM, in electric push, sets Buick Velite 6 PHEV, EV for China
    For GM, VW and their Chinese partners, breaking up may be hard
    Letter
    to the
    Editor

    Send us a letter

    Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

    Recommended for You
    Digital Edition
    THIS WEEK'S EDITION
    See our archive
    Fixed Ops Journal
    Fixed Ops Journal - 10-21-19
    Read the issue
    See our archive
    Sign up for free newsletters
    EMAIL ADDRESS

    Please enter a valid email address.

    Please enter your email address.

    Please select at least one newsletter to subscribe.

    You can unsubscribe at any time through links in these emails. For more information, see our Privacy Policy.

    Get Free Newsletters

    Sign up and get the best of Automotive News delivered straight to your email inbox, free of charge. Choose your news – we will deliver.

    Subscribe Now

    Get 24/7 access to in-depth, authoritative coverage of the auto industry from a global team of reporters and editors covering the news that’s vital to your business.

    Subscribe Now
    Connect With Us
    • Facebook
    • Instagram
    • LinkedIn
    • Twitter

    Our mission

    The Automotive News mission is to be the primary source of industry news, data and understanding for the industry's decision-makers interested in North America.

    AN-LOGO-BLUE
    Contact Us

    1155 Gratiot Avenue
    Detroit, Michigan
    48207-2997

    (877) 812-1584

    Email us

    Automotive News
    ISSN 0005-1551 (print)
    ISSN 1557-7686 (online)

    Fixed Ops Journal
    ISSN 2576-1064 (print)
    ISSN 2576-1072 (online)

    Resources
    • About us
    • Contact Us
    • Media Kit
    • Subscribe
    • Manage your account
    • Reprints
    • Ad Choices Ad Choices
    • Sitemap
    Legal
    • Terms and Conditions
    • Privacy Policy
    Automotive News
    Copyright © 1996-2019. Crain Communications, Inc. All Rights Reserved.
    • HOME
    • NEWS
      • Dealers
        • Access F&I
        • Fixed Ops Journal
        • Marketing
        • Used Cars
        • Sales
        • Best Practices
        • Dealership Buy/Sell
        • NADA
        • NADA Show
      • Automakers & Suppliers
        • Automakers
        • Manufacturing
        • Suppliers
        • Regulations & Safety
        • Executives
        • Leading Women Network
        • Guide to Economic Development
        • PACE Awards
        • Management Briefing Seminars
        • World Congress
      • News by Brand
        • Aston Martin
        • BMW
          • Mini
          • Rolls-Royce
        • Daimler
          • Mercedes Benz
          • Smart
        • Fiat Chrysler
          • Alfa Romeo
          • Chrysler
          • Dodge
          • Ferrari
          • Fiat
          • Jeep
          • Maserati
          • Ram
        • Ford
          • Lincoln
        • General Motors
          • Buick
          • Cadillac
          • Chevrolet
          • GMC
          • Holden
        • Honda
          • Acura
        • Hyundai
          • Genesis
          • Kia
        • Mazda
        • McLaren
        • Mitsubishi
        • Nissan
          • Infiniti
        • PSA
          • Citroen
          • Opel
          • Peugeot
        • Renault
        • Subaru
        • Suzuki
        • Tata
          • Jaguar
          • Land Rover
        • Tesla
        • Toyota
          • Lexus
        • Volkswagen
          • Audi
          • Bentley
          • Bugatti
          • Lamborghini
          • Porsche
          • Seat
          • Skoda
        • Volvo
        • (Discontinued Brands)
      • Cars & Concepts
        • Auto Shows
          • Detroit Auto Show
          • New York Auto Show
          • Los Angeles Auto Show
          • Chicago Auto Show
          • Geneva Auto Show
          • Paris Auto Show
          • Frankfurt Auto Show
          • Toronto Auto Show
          • Tokyo Auto Show
          • Shanghai Auto Show
          • Beijing Auto Show
        • Future Product Pipeline
        • Photo Galleries
        • Car Cutaways
        • Design
      • China
      • Shift
      • Mobility Report
      • Special Reports
      • Digital Edition Archive
      • This Week's Issue
    • OPINION
      • Blogs
      • Cartoons
      • Keith Crain
      • Automotive Views with Jason Stein
      • Columnists
      • China Commentary
      • Editorials
      • Letters to the Editor
      • Send us a Letter
    • DATA CENTER
    • VIDEO
      • AutoNews Now
      • First Shift
      • Special Video Reports
      • Weekend Drive
    • EVENTS & AWARDS
      • Events
        • World Congress
        • Retail Forum: NADA
        • Canada Congress
        • Marketing 360: L.A.
        • Europe Congress
        • Retail Forum: Chicago
        • Leading Women Conference Detroit
        • Retail Forum: Toronto
        • Fixed Ops Journal Forum
      • Awards
        • 100 Leading Women
          • Submit a nomination for 2020
        • 40 Under 40 Retail
        • All-Stars
        • Best Dealerships To Work For
        • PACE Awards
        • PACEpilot
        • Rising Stars
        • Europe Rising Stars
    • JOBS
    • +MORE
      • Leading Women Network
      • Podcasts
        • Shift: A Podcast About Mobility
        • Special Reports Podcasts
        • Weekend Drive Podcasts
      • Webinars
      • Publishing Partners
        • Ally: Do It Right
        • DealerSocket
        • Deloitte: Cyber everywhere: Preparing for automotive safety in the face of cyber threats
        • Facebook: The road to a zero-friction future
        • Guide To Economic Development
        • PayPal Credit: How consumer financing helps drive sales for online auto parts retailers
      • Classifieds
      • People on the Move
      • Newsletters
      • Contact Us
      • Media Kit
      • RSS Feeds