China Investment Roadmap: the Automotive Parts Industry

May 15, 2015 Posted by China Briefing Reading Time: 3 minutes

The newest issue of China Briefing Magazine, titled “China Investment Roadmap: The Automotive Parts Industry,” is out now and available as a complimentary download in the Asia Briefing Bookstore through the month of June.

Contents:

A Look under the Hood: Overview of China’s Auto Parts Industry
Gearing Up: Investing in China’s Automotive Parts Industry
Expert Commentary: Opportunities in New Energy Vehicles

These are exciting times for the automotive industry in China. The country recently overtook the United States to become the world’s largest car market and shows no signs of slowing down. As more and more Chinese enter the middle class, their demands for mobility increases. As a result, car use in China has exploded.

In its wake we find the industry that makes the wheels spin: the automotive parts industry. Attracted by the rapid demand for cars, thousands of automotive parts companies have sprung up across China, resulting in the highly fragmented sector we find today. Up until recently, car makers were able to exert pressure on parts manufacturers, drawing the attention of China’s anti-trust regulators. Following a host of harsh fines and penalties meted out to the major car makers, auto parts manufacturers are now able to sell directly to repair shops and consumers – a move that enhances their price setting capability.

In this issue of China Briefing, we present a roadmap for investing in China’s automotive industry. We begin by providing an overview of the industry, and then take a comprehensive look at key foreign investment considerations, including investment restrictions, tax incentives and manufacturing requirements. Finally, we discuss foreign investment opportunities in a part of the industry that receives substantial government support: new energy vehicles.

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Asia Briefing Ltd. is a subsidiary of Dezan Shira & Associates. Dezan Shira is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in China, Hong Kong, India, Vietnam, Singapore and the rest of ASEAN. For further information, please email china@dezshira.com or visit www.dezshira.com.

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