China drops rules that exclude foreign carmakers
"Foreign companies may already be in a box (in China)", said Chao, adding that the joint venture structure was now so ingrained that many might not want to change it.
China, by far the largest automobile market in the world, announced this week it would start to gradually open up its auto industry to foreign investment by removing existing limits to foreign ownership of vehicle ventures.
The highly symbolic moves in autos come after President Xi Jinping said last week China would scrap ownership limits "as soon as possible", exciting global auto brands even as Beijing and Washington spar over trade tariffs. Companies from Daimler AG and BMW AG to General Motors Co. and Toyota Motor Corp. are set to find it easier to manufacture and do business in China, while local makers will be under increased pressure to speed up the building of their own brands.
"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".
Currently, China accounts for roughly half of VW's brand sales, and is also the most important market for luxury models from Mercedes, Audi and BMW. Volkswagen said it will analyze if China's move leads to new options, saying its existing joint ventures won't be affected. Tesla declined to comment.
German and USA carmakers were quick to welcome the news, while reassuring that they won't abandon local partners. General Motors said its growth in China is a result of working with its partners, and that it would keep doing so.
Elon Musk's Tesla, in particular, is in a position to benefit from the relaxed ownership rules.
Читайте также: Amy Schumer reponds to feminist backlash over new film 'I Feel Pretty'The restrictions have limited Tesla's planned China assembly plant. Without an ownership cap, disagreements over ownership structure could be a thing of the past. The risk of higher import taxes spurred by Chinese trade friction with the USA may be allayed if Tesla is able to clinch a local manufacturing agreement.
Analysts said the main beneficiaries, at least in the short term, would be manufacturers focused on new-energy vehicles, including USA electric carmaker Tesla, which has been seeking to set up its own plant in Shanghai.
"The pace of the open-up is much faster than the market had thought", Zhuang said.
China's fifth-largest auto maker BAIC, which has a joint venture with Mercedes Benz and another with South Korea's Hyundai, collapsed nearly 13 percent in Hong Kong, while Brilliance China Automotive shed nearly nine percent. "It's not like 10 years ago, when foreign brands had a big technology advantage".
The removal of the cap signals China now has more confidence in its home-grown contenders.
Authorities recently announced that China would ease foreign equity restrictions in the automobile industry and significantly lower import tariffs for vehicles, as part of the country's broader opening-up push.
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