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Private Enterprise Makes Its Way in Chinese Car Industry
Usually, Chinese people have to pay more than 100,000 yuan for an economical car. Now new models priced at lower than 50,000 yuan enable more people to own their own vehicle.
Earlier this year, Geely, a private car maker, reduced the price of its car to a record low of 29,900 yuan (about US$3,600), while other car makers were cutting their prices for a bigger market share.
Experts say the protected Chinese car industry had little domestic competition in the past, thus lacking the incentive to develop. In the 1980's, foreign capital came into the country and joint-venture partnerships were set up and took a dominant position in the local car market. The national car industry faces big challenges with China's imminent entry into the World Trade Organization.
Since China implemented the reform and opening-up policy over twenty years ago, the private sector has developed rapidly, especially in the processing and service industry. Private capital began to flow into the car industry in the later years of the 20th century.
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