Auto Car Companies Industry in China | Free Essay Example

Auto Car Companies Industry in China

Words: 1346
Topic: Business & Economics
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With the ever-growing and stable development of China’s economy, the Chinese domestic auto industry has become one of the most vibrant sectors of China’s economy. Over the recent past, this industry has come up with new automobile brands that have made China to be ranked one of the leading automakers in the world. For example, China’s sedan is one of the bestselling car brands in the world, something that is spreading to other brands, because of the emphasis placed by the Chinese government on the need for companies to produce independent car brands that meet the technological needs of the modern day societies.

In addition to meeting the technological demands of the contemporary societies, most Chinese auto manufacturers have also gone green, as most of them are venturing into manufacturing environmentally friendly cars. As research studies show, in 2008 China manufactured approximately nine million three hundred and forty five million cars, a figure that surpassed that of the United States. A year later, (in 2009) China was ranked as one of the world’s biggest one auto manufacturers after Japan.

Examples of the biggest car manufacturing companies in China include Shanghai Volkswagen Automotive Company, FAW-VW Automobile Company, Shanghai General Motors Company, Beijing Hyundai Motor Company, Dongfeng Nissan Limited, BYD Company limited, and Chery Automobile Company. Therefore, China is the only emerging global economies that have led the car manufacturing industry within a very short time, because of its ever-increasing demand volumes of autos that are not only technologically fit, but also environmentally friendly (Xinsheng and Xiaohui, 2008, pp. 1-6).

As compared to other car manufacturing companies in the world, most Chinese auto manufacturers use the most advanced technologies in their processes, because of the strong emphasis laid by these companies on cars that are of high technological standards and high added value. Currently, although numerous global automakers have gone a notch higher in their car manufacturing technologies, China is one of the new hot-bed technologically, because of the numerous new car brands that its companies manufacture. For example, to meet the needs of the “common” Chinese citizen, auto manufacturers have come up with brands such as the 2CVs; a car model with an air cooled engine, a high thermoplastic body, and reduced exhaust emissions.

Other companies such as the Volkswagen have ventured into enhancing its chico concept; a technological idea meant to produce car brands that meet the new global technological, economical, and environmental demands. On the other hand, most Chinese automakers such as SAIC Company have grown to be the best hybrid car manufacturers, as most companies aim to manufacture cars that have high fuel efficiency. Although most Chinese automakers work in partnerships with different international car manufacturers, the level of innovation in most companies that are based in China surpasses the technological development in other affiliated companies of most foreign car firms in other parts of the world. To always make sure that they maintain high technological standards, most Chinese automakers purchase technology from developed international firms, which they develop further to meet both local and international demands (Cooney, 2006, pp. 2-22).

In terms of sales, China is one of the emerging economies with the highest numbers of sales globally, as most Chinese auto manufacturers have expanded their market segment into most developed and developing countries such as the Britain, USA, India, France, and numerous Asian Countries. This has been made easy by the reduced government restrictions on the car manufacturing industry, for example, on joint ownership, and on import and export tariffs. Since 2005, there has a tremendous increase in the number of vehicles that are manufactured in China for both local uses and for export purposes. For example, in 2009 China sold 13.5 million cars; a figure that increased to seventeen million in 2010. Further, in the last few years some Giant Car manufacturing BYD, Chery, and Geely have topped the global car sales charts; hence, the nature of market share they usually enjoy in global markets (Xinsheng & Xiaohui, 2008, pp. 1-5).

In addition to leading technologically and in sales, China’s car manufacturing companies have also excelled in producing environmental friendly cars, such as the electric cars. Over the recent past most car manufacturing companies have ventured into manufacturing energy saving autos, as one of the primary way of conserving the environment. These like efforts have succeeded in china, because of the numerous subsidies that are offered by Chinese government to companies that manufacture environmentally friendly cars. Between 2010 and early 2011, energy autos comprised five percent of the total number of cars that were manufactured in China, most of which were pure electric or plug-in hybrid or general hybrid.

As a result of the increased acceptance of such cars internally, most Chinese auto companies have high prospects that their energy cars will sell well in other global markets. Companies that manufacture energy cars in China include Byvin Corporation, Shijiazhuang Shuanghuan Automobile Company,BYD, and Xi’an Simo Motor Company. One factor that has promoted the quest by most Chinese auto companies to adapt the green technology is the increasing numbers of individuals who want private cars. Therefore, to ensure that these companies control the amount of pollution from cars, most Chinese auto companies are the world leaders in promoting the manufacture of environmentally friendly cars (Tiezheng, 2010, p.1).

Although most Chinese manufacturing companies have excelled in terms of technology sales, and in protecting the environment, as research studies show most nations degrade car products from China, because of their quality. As Xinsheng and Xiaohu (2008, p.4) states, majority of products from China re low grades; hence, the reduced amount of foreign exchange that the country earns from its exports. Majority of the car brands manufactured in China are meant to suit the budget of an average Chinese earner. Therefore, in most cases, such car products do not meet the required standard car requirements of most developed nations. Regardless of this, some Chinese auto companies have endeavored to produce cars that can exported to most developed countries for example, Cheryl’s Seolin and BYD S8.

One of the biggest car manufacturing companies in China is Shijiazhuang Shuanghuan Automobile Company. Shuanghuan Automobile Company is one of the biggest commercial car manufacturers in China, known well for its different types of hybrids and classic SUVS. It is also known for its advanced technologies in pressing, welding, painting and assembling. The company has existed since 1988, although it received its authentication and verification in 1995. The company is owned by Zhigang Zhao and its headquarters are found in Qiaodong, Shijiazhuang, Hebei, China.

Shuanghuan Automobile Company was ISO9000 quality control system certified in 2000. Since its establishment, the company has exported thousands of cars and it is recognized internationally; hence, the nature of market acceptance it products rseceive internationally in countries such as North and South America, Southeast Asia, Middle East, Africa, and some European countries. Examples of cars that are manufactured by this company include Shuanghuan Laibao, Jiaolian, Rabo, different makes of electric cars, SUVs, and mini noble cars (Shijiazhuang Shuanghuan Automobile Company 1).

In conclusion, China has always shone technologically and is one of the fastest growing economies; hence, the nature of acceptance it receives in most global economies. Therefore, with the ever-increasing technological advancements that most Chinese auto companies are adopting, likelihoods of China becoming the best global leader in car manufacturing are high. This is something that other auto manufacturing countries should take note of to avoid being left behind in their ventures to shine also.

References

Cooney, S. 2006. China’s impact on the U.S. automotive industry. CRS report for Congress. Web.

Shijiazhuang Shuanghuan Automobile Company, 2011. Shijiazhuang Shuanghuan Automobile Company profile. Web.

Tiezheng, L. 2010. China pushes for green-car development. Web.

Xinsheng, W., & Xiaohui, F. 2008. Analysis and evaluation of the development strategy of China’s family cars industrial independent brands. Web.