From London’s Telegraph to Fox News, from Autoblog to Autoguide, the story this week is that the Chinese will turn against foreign carmakers by mandating that the Chinese government only buys Chinese cars. Why was TTAC not writing it? I learned to ignore that story. I have lived in China since 2005, and just about every year, there was an announcement that the Chinese government will from now on only buy Chinese. It never happened. Despite the annual announcements, foreign brands still account for 80 percent of the Chinese government motor pool. But maybe it’s different this time?
If you read the press and the blogs, it seems so: “China bans foreign cars from government fleet” headlines Leftlane News. In the story, they write that “the Ministry of Industry and Information Technology has just released a list of the 412 cars that can be purchased by state and local governments. For the first time in the country’s recent history, every single car that is present on the list is Chinese.”
Leftlane News, along with the other breathless and superficially informed outlets have their facts wrong. Sure, there is a list. Sure, there are only Chinese cars on it. But no, this list means absolutely nothing. The list, published on a Chinese government website, says in big (Chinese) letters: DRAFT. The list is out there (allegedly) for public consultation. People can voice their opinion (deadline March 9,) and then the Chinese government will do as it may please. The Chinese government will have fooled the western media and the Chinese population, again.
Will the Chinese government legislate away the long version of the Audi A6, which (along with a white license plate) is a sign that here comes a government honcho? I don’t think so. One of the few papers that are likewise skeptical is the Wall Street Journal. It writes:
“It won’t be that simple. The new list is at the consultation stage. Even if it comes into effect, implementation will be difficult. A move last year to restrict mid-level government officials to buy smaller, cheaper cars appears to have had little impact on sales. Dealers say officials evade restrictions and get the car of their choice anyway. The new list is good public relations for a government keen to show it is cracking down on abuse of public funds. But it will be a while before China’s citizens can hope to spy officials behind the black tinted windows of a domestic brand car.”
Apart from the brand cachet, there is one part of the Chinese car business that is often forgotten: Chinese joint ventures with foreign carmakers mostly are with government-owned entities. If the Chinese government buys an Audi, a Buick, a Nissan, a Mercedes, a Volkswagen, it does business with an entity that is half government-owned. If a truly “Chinese” car is bought, more often than not it comes from an independent upstart that used to produce refrigerators before venturing into cars. A face-conscious Chinese bureaucrat simply won’t be seen in a former refrigerator. Not while he’s alive.