Chinese economic policies could be in for a big change, as President Xi Jinping pushes the communist country to open its domestic markets even further. That could mean big things for the auto industry, especially when it comes to the country's far-reaching joint-venture system.

According to Chinese law, foreign automakers may only maintain a fifty-fifty partnership with their domestic counterparts. But with Jinping's push for openness leading to potential free-trade deals, that policy could be relaxed (or eradicated all together) in short order. What's an automaker to do?

Well, in BMW's case, stay the course. Automotive News Europe reports that, despite the grumblings about the JV policy changes, the German manufacturer has resigned its agreement with Brilliance through 2028. This is made doubly remarkable by the fact that BMW signed the extension over three years before it was set to expire.

Prevailing logic says that's because these joint ventures allow foreign automakers to operate boots-on-the-ground manufacturing operations that can help drive sales inside the PRC. For BMW, that's key to becoming the top dog in China's booming luxury market, notes Automotive News Europe.

BMW isn't the only manufacturer that's extended its partnership for the extended future. Volkswagen inked a deal with its partners in 2012 that will run through the next two decades.

That still leaves a huge number of manufacturers with partnerships up in the air, though. What do you think manufacturers like Mercedes-Benz and General Motors will do if given the option to increase their stake, stage a takeover or divorce from their joint venture partners? Have your say in Comments.


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  • 14 Comments
      david.bergman1
      • 5 Months Ago
      As the Chinese liberalize their economy manufacturers should take the opportunity to rid themselves of such socialistic forced joint venture agreements. Companies that have renewed their contracts prior to their expiration did so, I assume, because it creates a higher degree of predictability which is crucial for entrepreneurial activity. Plus, they may have been confident that under the current regime they could obtain better terms than those that they might get in the future.
      jz78817
      • 5 Months Ago
      It pisses me off that we even agreed to that in the first place. Chinese companies are free to set up shop and sell their **** here, but when they place restrictions like mandatory 50-50 joint ventures, we just say "Well, OK then."
        Tariff The Imports
        • 5 Months Ago
        @jz78817
        Hence my handle/name. It's disgusting how Canada and the USA have let our shore become wide open, while others protect theirs. Our tax base shrinks due to loss of good paying mfg jobs. Has outsourcing to China made my Nikes, Levi's, that gallon of paint cheaper? That's what we as consumers were spoon fed. The answer is no. Lu Lu Lemon is now made in China, but my GF is still charged the same price she was paying when they were made in Canada. WTF?!! Tax and tarrif goods from any company that use to make their product here. Made the tarrifs so grand that it will be cheaper to reintroduce the mfg here and employ our nations citizens. It's sickening how our governments sold out the people they're supposed to represent. How can communist China own and operate mines, oil lumber here? They are our natural resources. Nationalize all our natural resources and our nations will flourish. No more debt. No more lack of funds for education, health care, infrastructure etc...
          LW
          • 5 Months Ago
          @Tariff The Imports
          You think our gob'mint took down these so called trade barriers for the benefit of china? who do you think outsourced all the jobs to the lowest bidder? A pair of nike that cost $100 and $20 to make here went to china and ended up costing only $4, do you think china is making a killing with that $4 (minus parts) of labor profit or nike with its extra $16 in profit? How does free trade law that override a nation's sovereignty and its laws benefit anyone? In fact it benefit no nations, only multi-national corporations. How does selling much of our extremely heavily subsidizes corn to latin america nations count as free trade? especially if it puts all their farmers out of work, causing them to come to the US for jobs?
          Ben Meng
          • 5 Months Ago
          @Tariff The Imports
          It's not a one side thing. I am afraid you have never been to China. Look how many American brands are there in Chinese people's daily life. Starbucks, KFC, McDonald's, Pizza Hut, Burger King, CocaCola, Pepsi, Nike, Levi's, GAP etc. You will also be surprised by the amount of Buicks on streets of Chinese cities. If there is no Chinese market, it's really hard to tell if GM could survive.
          clquake
          • 5 Months Ago
          @Tariff The Imports
          The market determines the prices. If your gf is already willing to pay x for whatever, they have no incentive/need to lower the price.
        mbukukanyau
        • 5 Months Ago
        @jz78817
        We can blame congress for that. We could reciprocate but congress lacks bolls
        icemilkcoffee
        • 5 Months Ago
        @jz78817
        "Chinese companies are free to set up shop and sell their **** here" Can you name one Chinese company that has done that? Therein lies the rub. China is way behind in technology. They need to catch up. This is the only way they can catch up without letting the foreigners take over their economy- by restricting foreign ownership.
      budwsr25
      • 5 Months Ago
      The women in the photo is not bad looking. She's not wearing a face mask must had been a good air quality day.
      • 5 Months Ago
      Like a rock
      MechE
      • 5 Months Ago
      One hundred Internet points if you can name the car in the photo.
        • 5 Months Ago
        @MechE
        Its a Buick Century. Could also be a Regal.
        • 5 Months Ago
        @MechE
        i have no idea. 90s buick ?
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