China has reversed a policy that would have nixed incentives for investments from foreign automakers, paving the way for further expansion by General Motors, Volkswagen and others. Legislators had removed automotive manufacturing from the list of industries that would receive government support in the future, but foreign investment fell off significantly in April. The country's National Development and Reform Commission responded by not only reinstating foreign automotive investment but by giving the business "preferential treatment," according to Automotive News. Last year, China's central and western regions attracted $19.2 billion in foreign investment across the board.

With China serving as the world's largest automotive market, manufacturers are keen to make inroads in the region. The local government incentivised foreign-owned manufacturing plants for some seven years before the National Development and Reform Commission removed the industry from its approved list in an attempt to stave off overcapacity. Automotive News reports GM and VW have both invested heavily in the region, with the latter set to begin construction on an all-new facility. The new plant is part of a $13 billion investment in China and will join Volkswagen's 12 other car and component facilities in the region.

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    • 1 Second Ago
      James John
      • 2 Years Ago
      Yes, pls continue to "invest" in our country, It just makes it easier for us to kick u out once we have all the IP we need.
      • 2 Years Ago
      All the better to steal our technology. Apparently their wholesale theft of IP through hacking isn't quite transferring our tech fast enough for them.
      • 2 Years Ago
      Labor is really cheap in China, so people who buy poorly built Volkswagens don't have to worry about repair costs.
      • 2 Years Ago
      That's a real scary bubble. Here's hoping for the people of China to survive when it pops. It isn't just the auto industry. All cheap labor is subsidized.
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