So you want to sell your foreign cars in China? If you're an automaker, it might cost you a whole lot do so. A report in The Wall Street Journal claims that the Chinese government wants to force foreign companies to divulge their electric vehicle technology secrets in order to sell their products in China.
China wants to become a global power in the development and production of electric cars and hybrids. Apparently, they want to skip the whole research part and go right to utilizing technology developed and tested by others. This would be fine if they wanted to pay for said tech, but simply bullying manufacturers into handing it over is not the way to go.
From the WSJ:
China is a very important market for automakers, as it's the world's largest purchaser of automobiles. China's current proposal says that any foreign automaker wishing to produce new-energy products there must establish joint-venture agreements with Chinese companies. The foreign automaker would then only be allowed to hold a 49-percent stake in the newly formed alliance. Obviously, this isn't sitting well with companies that have invested massive sums of money developing new energy-efficient solutions."The car executives are joining a chorus of companies criticizing China's industrial policies. Business people and government officials say Beijing's so-called indigenous-innovation efforts discriminate against them and are aimed at gaining control of foreign intellectual property."
Forcing a so-called "alliance" that all but hands over highly-valuable intellectual property to the Chinese party is not an example of China "playing nice" with others. Hopefully, a more workable solution can ultimately be agreed upon. Unfortunately, China has a lot of leverage here. It knows exactly how important its market is to every other automaker on Earth, and it's obviously not afraid to twist arms to get what it wants. Thanks for the tip, Sea Urchin!
[Source: The Wall Street Journal]