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back to index backASIAtalk May,  2012


China Automotive Monthly: Executive Summary (March, 2012)

New Government Vehicle Purchase Rules, Not as Sweet a Pastry for the Chinese Brands as it Might Appear.

The recently released list of approved vehicles for government purchase, released by the Ministry of Industry and Information Technology (MIIT), has caused quite a stir because all of the 412 models included are from Chinese brands. This is a particular set back for foreign brands like Audi, which have traditionally been the brand of choice for the Chinese government. Some foreign media have been particularly critical of the list, calling it a violation of WTO principles.

I believe though that this policy is in line with public opinion, whereby government purchases require greater scrutiny and more cost controls. After all, it seems unreasonable to use taxpayers' money to buy luxury cars for a small group of public officials.

However, to become a supplier of official vehicles in China you do not need to be a Chinese brand, but the three conditions are such that it is difficult for the foreign brands to meet them. Vehicles sold for official purposes, such as tax collection or criminal investigation, must have an engine size of 1.8 liter or below, cost no more than 180,000 yuan (USD 28,571) and the manufacturer must have spent no less than 3 percent of their core revenue on research and development in China in the past two years.

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Source: LMC Automotive - GAI





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