China re­moves auto own­er­ship cap

The Star Malaysia - StarBiz - - Digital Trend -

BEI­JING: China will al­low for­eign au­tomak­ers from Volk­swa­gen AG (VW) to Ford Mo­tor Co to own more than 50% of lo­cal ven­tures, re­mov­ing a two-decade re­stric­tion and giv­ing a boost to global com­pa­nies seek­ing to cap­ture a greater share of the world’s largest car mar­ket.

In a move help­ing elec­tric-car mak­ers such as Tesla Inc, the own­er­ship lim­its for new-en­ergy ve­hi­cles would be re­moved this year, Na­tional De­vel­op­ment and Re­form Com­mis­sion said in a state­ment on its web­site.

China will do away with the limit for com­mer­cial ve­hi­cles in 2020 and that for pas­sen­ger ve­hi­cles in 2022.

Po­ten­tial ben­e­fi­cia­ries in­clude com­pa­nies from Daim­ler AG and BMW AG to Gen­eral Mo­tors Co and Toy­ota Mo­tor Corp, all set to find it eas­ier to man­u­fac­ture and do busi­ness in China.

The coun­try’s lo­cal auto mak­ers, mean­while, will be under in­creased pres­sure to speed up the build­ing of their own brands.

Shares in Ger­man car­mak­ers all gained on the news, rev­ers­ing ear­lier losses. China ac­counts for about half of VW’s name­sake brand sales, while the world’s big­gest car mar­ket is also the most sig­nif­i­cant buyer of lux­ury Mercedes, VW’s Audi unit and BMW ve­hi­cles. €

VW rose as much as 0.9% to 173.48. Both BMW and Mercedes-maker Daim­ler rose about 0.5%.

Newspapers in English

Newspapers from Malaysia

© PressReader. All rights reserved.