Two-thousand-word thesis: How to make China's automobile industry bigger and stronger after China's entry into WTO!

Independent development: the pillar of China automobile industry to become bigger and stronger

Since the reform and opening up, there has been a debate on whether to develop independently in the development of China's automobile industry, which has affected the development of China's automobile industry. It can be expected that this debate will continue for some time. Although the specific content of each debate will be different, it is essentially the same. The author thinks that after China's entry into WTO, under the background of economic globalization, whether the development of China's automobile industry needs to adhere to independent development is still a major strategic issue related to the development of China's automobile industry, especially an unavoidable issue for China's automobile industry to realize its dream of becoming a powerful country. In this regard, the author's point of view is that the development of China's automobile industry can not be separated from independent development, which is the pillar of China's automobile industry to become bigger and stronger.

First, the importance of independent development in the development of China automobile industry

1. Maximizing economic benefits, competitive advantages of enterprises and requirements for survival rights

The development of China automobile industry emphasizes independent development, which is mainly determined by economic benefits, that is, the requirement of maximizing the economic benefits of China automobile enterprises. Only through independent development can enterprises obtain products with independent intellectual property rights, and can they obtain the greatest economic benefits, excess profits and rich returns. At present, it is this kind of interest that global multinational enterprise groups have obtained. These large groups seek the best resource allocation in the world, and use local raw materials and labor to produce and sell locally, and even some R&D bases are located locally. The core technology, intellectual property rights, brand and management system of the products belong to the big companies themselves, and thus obtain a lot of excess profits.

Emphasizing independent development, there is also a question of the right to exist of China automobile enterprises. Before joining WTO, this problem was not very urgent. At that time, China's automobile industry was protected by high national tariffs and various non-tariff measures, and domestic automobile enterprises, including joint ventures, were more likely to make profits (this situation will continue for some time during the transition period). After entering WTO, China gradually lost the protection of high tariff and non-tariff measures. If domestic automobile enterprises do not have the ability of independent development for a long time and are subject to people for a long time, they will not only be unable to make profits and develop, but will probably lose their right to survive in the end. It will take about seven or eight years to eliminate an automobile enterprise without independent development ability.

Whether an enterprise has the ability of independent development is also directly related to whether an enterprise has a competitive advantage in the market. Competitive advantage is the embodiment of enterprise's core competitiveness. An important feature of competitive advantage is that it can lead the market trend rather than follow the market. Enterprises that adopt the following strategies generally do not have a strong competitive advantage. If an enterprise has the ability of independent development, it can continuously introduce leading products that meet the market demand, and it can always be at the forefront of the market and occupy a larger market share.

2. China automobile enterprises become the world's top 500 requirements.

At present, when making development plans, domestic large-scale automobile enterprise groups all take becoming one of the top 500 in the world as their own goal. Imagine that a Fortune 500 company will never be able to develop independently, own its own intellectual property rights and own its own brand. It can be predicted that if China automobile enterprises have no independent development ability and intellectual property rights for a long time, it will be very slim to enter the world's top 500.

3. Respond to the needs of economic globalization

Economic globalization is a double-edged sword. The essence of economic globalization is that multinational enterprise groups in developed countries optimize the allocation of resources on a global scale, which is a process of industrial transfer. This kind of industrial transfer has two ways:

One is that developed countries transfer some traditional industries with low technology content to developing countries as a whole, such as textile, clothing and toy industries. This industrial transfer is beneficial to the economic development of developing countries. Generally speaking, developed countries will not stop the transfer of traditional industries to developing countries, and even sell technology to developing countries in order to obtain the final extra profits.

The other is that developed countries take advantage of the low labor cost in developing countries to transfer the manufacturing processes of some industries to developing countries, such as high-tech industries such as automobiles. This kind of industrial transfer is of little benefit to developing countries, and in the long run, it is not worth the loss. The reason is that in the operation of this industrial transfer mode, multinational enterprise groups in developed countries always control the core technology and intellectual property rights of products, while developing countries only get labor processing fees. Because the profits earned by multinational enterprise groups are not proportional to the local government's taxes and the country's labor processing fees, multinational enterprise groups sell their products on the spot, which not only avoids the restrictions of local government's tariffs and policies, but also maximizes profits. In view of this industrial transfer, enterprises in developing countries will lose the high tariff protection of the country and will be in a very unfavorable position and will be deeply constrained by the global economy if they do not cultivate their own development capabilities. In this process of industrial transfer, multinational enterprise groups generally adopt a strict blockade strategy for developing countries in terms of core technologies and intellectual property rights. Their goal is winner takes all, which is also a feature of economic globalization. It can be said that enterprises in high-tech industries do not have the ability of independent development, and it is empty talk to deal with economic globalization.

4. The need of national comparative economic interests

From the national point of view, there is a question of comparative economic benefits. At that time, a large number of Japanese home appliances flooded into the United States, and the home appliance industry in the United States was almost wiped out, so that the United States finally had to give up the home appliance industry. At the same time, a large number of Japanese cars have entered the United States, threatening the American automobile industry, and some people in the United States have raised the question of whether to give up the automobile industry. After in-depth and extensive discussions, the American government finally decided that it must never give up the automobile industry, and at the same time strengthened its support for the automobile industry.

It is also a traditional industry, and the United States has abandoned the home appliance industry instead of the automobile industry, which mainly reflects the country's comparative economic interests. On the basis of extensive argumentation, the United States has realized the choice of traditional industrial layout.

After giving up the general traditional home appliance industry, the United States turned its industry to emerging high-tech IT, biology, electronics, communications, finance and other industries, and achieved great success and amazing economic benefits. The automobile industry is closely related to the whole industrial system, even affecting a country's basic industry and the whole economy, which is why various countries regard the automobile industry as a pillar industry. The American government supported the development of the automobile industry, which helped the automobile industry out of the predicament.

There is no doubt that the decision of the US government is very correct. On the one hand, the high-tech industry in the United States has developed rapidly and continues to be the leader of the world economy, leaving Japan far behind; On the other hand, the American automobile industry still dominates the world, which ensures the sustained growth of the American economy in a long period of time.

On the other hand, it also involves the huge economic interests of the country and the nation, namely the transfer of wealth. With the rapid development of China's economy and the continuous improvement of people's living standards, owning a car is no longer an unattainable dream for many China families. If all the profits of a large number of cars are transferred to the capital of multinational enterprise groups, it is essentially the transfer of funds and wealth of our country and nation. The saying that as long as China builds cars and the government only collects taxes, ordinary people can find jobs is to turn a blind eye to the huge economic benefits.

5. Demand of industrial powers

Automobile industry is the main driving force for China's industrial growth in a long period of time after home appliances and other industries, and plays a decisive role in the development of the whole national economy. As we all know, the automobile industry is highly correlated, and its upstream and downstream involve many industries, which is an important part of a country's industrial manufacturing industry. China is moving from an industrial power to an industrial power. In this process, the automobile industry will play a decisive role.

To shoulder this historic responsibility, China automobile industry must have the ability of independent development. Compared with horizontal industries, in China, all industries with independent development capabilities, such as shipbuilding, aerospace and some high-tech industries, including some household appliances industries that are currently growing, have begun to enter the industries of world powers and have strong international competitiveness. However, only two industries, automobile and large passenger aircraft, still lag behind the world powers, and it is precisely these two industries that lack the ability of independent development. Therefore, the conclusion can only be: without independent development capability, it is impossible to form a strong automobile industry, and China's industrial strength will be greatly reduced.

Second, we should fully understand independent development.

To be sure, independent development is by no means the same as starting from scratch behind closed doors. In today's economic globalization and increasingly open social environment, it is undoubtedly impossible to start from scratch. To fully and correctly understand independent development, we must grasp the following points.

1. Establish the overall development strategy of independent development.

First of all, we should have the consciousness and thought of independent development, which is the soul of independent development, far more important than any technology, and it is related to whether we can strive for initiative and be in a favorable position in the development process. After establishing the consciousness of independent development, we should formulate the overall development strategy of independent development. That is, independently determine the development strategy, and make your own choices on the development direction and road of major strategies, such as the choice of joint venture object and joint venture mode, how to establish your own R&D base, how to digest and absorb imported technology, what kind of development strategy to adopt, how to establish your own brand, and how to establish distribution channels and after-sales service system in line with China's national conditions. Only in this way can we strive for initiative in the whole development process, be in a relatively favorable position and not be subject to others.

2. Being brave in practice is the key to independent development.

It is difficult to develop independently, but without practice, you will never have your own development ability. Even if others give us technology and intellectual property rights, there is still a process of digestion and absorption. In the process of independent development, we should form our own development ability, create our own development system and form our own development characteristics. If you think that your development level is backward and can't reach the advanced level in the world, you won't develop independently, and you will always be backward and never form your own development ability, which is quite dangerous.

3. Independent development does not mean all localization.

The most important thing for independent development is to decide the product development strategy and overall design, including what kind of car to develop, what kind of configuration to have, what kind of target users to face, how to make market positioning and so on. After these decisions are made, we can hire technicians from any country to develop for us in the early stage of independent development because of our weak development strength. But the premise is that intellectual property rights, technology patents and brands all belong to our country. This is also the practice of the world's multinational automobile groups and the requirement of internationalization.

4. The core technology can only be developed by ourselves.

The core technology can't rely on others, and it must be developed by itself. The transfer of automobile industry belongs to the second kind of industrial transfer in economic globalization. In this transfer, the core technology of multinational enterprise groups will not be easily transferred, and it will be absolutely blocked and controlled by developing countries. Therefore, it is more important to form the ability of independent development. While mastering the core technology, we should also form the ability of development system and management system.

5. Correctly understand the role of joint ventures

It should be recognized that joint venture is an important part of China's independent development of automobile industry. As a latecomer, China's automobile industry does not need to start from scratch, introduce advanced technology, and quickly complete the road that others have taken for decades to reach a more advanced level. This is a shortcut to development and a road that many countries have taken in the history of the world automobile industry. The rapid development of China's automobile industry has also benefited from joint ventures and cooperation with foreign countries after the reform and opening up. In this process, although foreign countries imposed various technical restrictions and blockades on China, they brought advanced technology and management, and trained a group of technical talents in automobile for China, thus realizing the leap-forward development of China's automobile industry. Today, international multinational automobile groups come to China, bringing different automobile technologies and management experiences. With China's further opening up after its entry into WTO, more adequate international cooperation will be more conducive to the accelerated development of China's automobile industry.

However, don't expect too much from the joint venture to establish the independent research and development capability of the whole vehicle. Joint ventures, especially those characterized by technology introduction, cannot establish their own vehicle R&D capabilities, which is determined by the attributes of joint ventures. The purpose of Sino-foreign joint ventures and cooperation is to enter the China market. After China's entry into WTO, foreign investors are eager to sell their products directly to China. Therefore, foreign companies let their parent companies engage in development. From an economic point of view, it is natural that joint ventures do not want to develop independently and invest heavily. More importantly, from a strategic point of view, the foreign side will never cultivate a future competitor for itself. Therefore, don't expect too much from the joint venture to set up a vehicle R&D department.

Third, China's automobile industry is welcoming a good opportunity for independent development.

From the domestic environment, the huge automobile market that is forming in China will help the rapid formation of the independent development ability of domestic automobile enterprises. In the next few decades, China will be the fastest growing and largest automobile market in the world. The huge demand in the automobile market will inevitably create a number of world-class automobile groups. At the same time, China's automobile market has its own characteristics, which can give full play to its local advantages and provide quite good market conditions for independent development. At present, some self-developed automobile enterprises in China are taking this road.

From the international environment, the supply of the whole international automobile market exceeds demand, and the cost of multinational companies is getting higher and higher. This is the fundamental reason for frequent mergers and acquisitions in the international automobile industry. Both international automobile capital and technology should seek a new way out, which is determined by the nature of capital. This also provides opportunities for the development of automobile enterprises in China. Some domestic auto companies with independent development ability should make good use of this opportunity.

The state should actively support the independent development of domestic automobile enterprises. The state finances independently develop large state-owned automobile enterprise groups, inject certain capital when necessary, and give preferential treatment and support in bank credit. Most automobile industry powers in the world have given great financial and financial support to the development of automobile industry. This is because the demand for capital in the automobile industry is beyond the reach of ordinary investors in both intensity and quantity, and it is difficult to develop rapidly only by the accumulation of the automobile industry itself. Although the country has established the principle of withdrawing from competitive industries, it should invest in industries that have an important impact on the future growth of China's national economy, such as automobile industry.

In the aspect of automobile industry policy, fully opening all kinds of domestic capital into the automobile field is conducive to full competition, which is very important and necessary for rapidly forming the independent development ability of domestic automobile enterprises.