China Considers Big Push For Auto Industry. Maybe

The Chinese government is considering plans to breathe new life in their still growing, but sputtering auto market. “Industrial growth is sharply declining and we have not seen a turning point yet. We feel a lot of pressure,” Industry Minister Li Yizhong said at a recent news conference in Beijing. The Minister laid out several initiatives, “but gave no indication any measures had been decided or when they might take effect,” Gasgoo says. The possible steps are:

– A $2.2 billion package of subsidized loans, targeted at improving technology and cutting energy use.

– Beijing might buy surplus steel to help producers and give aid to steelmakers for upgrading technology as demand plummets.

– Beijing is considering ways to revive car sales by cutting taxes, offering low-interest loans or forcing older vehicles off the road.

At the same time, China’s Ministry of Commerce plans to support the currently disappointing auto exports with a seven point program, their Zhi Luxun said today. According to a Gasgoo report, the points are:

First, probably provide a multi-billion $ program to stimulate auto exports.

Second, encourage medium- and small-sized enterprises to export more through training, certification, and trade show attendance.

Third, give incentives for auto companies to get certified abroad and to introduce foreign technology.

Fourth, grant credits to export-oriented auto companies.

Fifth, encourage auto companies to reduce export risks by taking advantage of commercial banks and insurance companies.

Sixth, continue support of the national export bases for both automobiles and auto parts.

Seventh, offering information for auto companies, such as export destination information, industry policies, tax policies and some other important market information.

But again, these measures are “being studied.” Which means they may come. Or they may not. Welcome to the land of ambiguity.