China Spooks Auto Makers
#1
09-17-2010, 08:17 AM
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China Spooks Auto Makers
Pretty scary...
WSJ.com
China Spooks Auto Makers
Foreign Companies Fear New Rules on Electric Cars Will Erode Intellectual Property
By NORIHIKO SHIROUZU
BEIJING—China's government is considering plans that could force foreign auto makers to hand over cutting-edge electric-vehicle technology to Chinese companies in exchange for access to the nation's huge market, international auto executives say.
China's Ministry of Industry and Information Technology is preparing a 10-year plan aimed at turning China into "the world's leader" in developing and producing battery-powered cars and hybrids, according to executives at four foreign car companies who are familiar with the ministry's proposal.
The draft suggests that the government could compel foreign auto makers that want to produce electric vehicles in China to share critical technologies by requiring the companies to enter joint ventures in which they are limited to a minority stake, the executives say.
The plan is "tantamount to China strong-arming foreign auto makers to give up battery, electric-motor, and control technology in exchange for market access," says a senior executive at one foreign car maker. "We don't like it."
The car executives are joining a chorus of companies criticizing China's industrial policies. Business people and government officials say Beijing's so-called indigenous-innovation efforts discriminate against them and are aimed at gaining control of foreign intellectual property.
Such complaints come amid broader frustration in the U.S. and elsewhere over China's trade and currency policies. Critics say China has kept the value of its currency artificially low, giving the country's exporters an unfair advantage in world markets.
On Thursday, U.S. Treasury Secretary Timothy Geithner told a Congressional panel that China needs to let its currency strengthen significantly. But he attempted to dissuade lawmakers from pursuing punitive steps against China, which he said could be counterproductive.
China's market is becoming indispensable for many companies. And multinational corporations continue to pour investment into China, which has mushroomed into a top market for everything from iron ore and cars to personal computers, beer and Bordeaux wine...
Foreign Companies Fear New Rules on Electric Cars Will Erode Intellectual Property
By NORIHIKO SHIROUZU
BEIJING—China's government is considering plans that could force foreign auto makers to hand over cutting-edge electric-vehicle technology to Chinese companies in exchange for access to the nation's huge market, international auto executives say.
China's Ministry of Industry and Information Technology is preparing a 10-year plan aimed at turning China into "the world's leader" in developing and producing battery-powered cars and hybrids, according to executives at four foreign car companies who are familiar with the ministry's proposal.
The draft suggests that the government could compel foreign auto makers that want to produce electric vehicles in China to share critical technologies by requiring the companies to enter joint ventures in which they are limited to a minority stake, the executives say.
The plan is "tantamount to China strong-arming foreign auto makers to give up battery, electric-motor, and control technology in exchange for market access," says a senior executive at one foreign car maker. "We don't like it."
The car executives are joining a chorus of companies criticizing China's industrial policies. Business people and government officials say Beijing's so-called indigenous-innovation efforts discriminate against them and are aimed at gaining control of foreign intellectual property.
Such complaints come amid broader frustration in the U.S. and elsewhere over China's trade and currency policies. Critics say China has kept the value of its currency artificially low, giving the country's exporters an unfair advantage in world markets.
On Thursday, U.S. Treasury Secretary Timothy Geithner told a Congressional panel that China needs to let its currency strengthen significantly. But he attempted to dissuade lawmakers from pursuing punitive steps against China, which he said could be counterproductive.
China's market is becoming indispensable for many companies. And multinational corporations continue to pour investment into China, which has mushroomed into a top market for everything from iron ore and cars to personal computers, beer and Bordeaux wine...
#2
09-17-2010, 01:00 PM
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Re: China Spooks Auto Makers
On Thursday, U.S. Treasury Secretary Timothy Geithner told a Congressional panel that China needs to let its currency strengthen significantly. But he attempted to dissuade lawmakers from pursuing punitive steps against China, which he said could be counterproductive.What the he$$ does Geither know??? cannot even pay his own taxes far from run the counties financial sector.
#3
09-18-2010, 07:47 AM
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Posts: 490
Re: China Spooks Auto Makers
China has been making "trade war" upon the United States for at least 30 years.
In the last two decades, they have gradually stepped up their war. US companies basically cannot operate in China, but must instead hand over trade secrets to Chinese companies, if they want to have market access. Importing to China is not an option, as the tariff and non-tariff barriers, including taxes, exchange rates, and customs procedures, effectively block foreign products. This has been the pattern in every product segment. Why should cars be any different?
China subsidizes exports, while taxing and outright prohibiting imports. If you want to sell something in China, you basically have to manufacture it there, and you have to give your trade secrets to the majority partner in the venture. A few months after you give them your trade secret, an *identical* product is available from a 100%-Chinese firm, at a lower price.
In the mean time, the US refuses to defend its market against the Chinese trade war.
In the last two decades, they have gradually stepped up their war. US companies basically cannot operate in China, but must instead hand over trade secrets to Chinese companies, if they want to have market access. Importing to China is not an option, as the tariff and non-tariff barriers, including taxes, exchange rates, and customs procedures, effectively block foreign products. This has been the pattern in every product segment. Why should cars be any different?
China subsidizes exports, while taxing and outright prohibiting imports. If you want to sell something in China, you basically have to manufacture it there, and you have to give your trade secrets to the majority partner in the venture. A few months after you give them your trade secret, an *identical* product is available from a 100%-Chinese firm, at a lower price.
In the mean time, the US refuses to defend its market against the Chinese trade war.
#4
09-21-2010, 06:26 PM
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