China releases new restrictions designed to boost green car technology transfer

Business Monitor International (BMI) said that the automobile industry is no longer among the top priorities of the Chinese government. On the surface, this may seem like a restriction on investment, but BMI said it believes that China may actually be aiming at increasing the transfer of technology from foreign car manufacturers. BMI believes that the latest foreign investment guidelines released by the National Development and Reform Commission (NDRC) is a soft approach towards encouraging participation of foreign carmakers in the green car segment. China’s goal is to have one million electric vehicles (EVs) on the road by 2015. Regardless of the latest investment regulations, many foreign carmakers in China have already set high goals. General Motors Company (GM), a leading foreign brand by sales volume, has signified its intention to increase production in its alternative fuel segment. In September 2011, Ford Motor Corp. announced plans to produce electric vehicles with Changan Automobile Group. Analysts say that the new investment policy will more likely present problems to foreign companies that are considering the production of conventional vehicles in China. (January 4, 2012)