China's Auto Industry's International Competitiveness

Automobile industry, as a capital and technology intensive modern industry, with its strong relevance, high elasticity of demanding price, elasticity of income price, and obvious scale economy effect, play an important role in stimulating the national economy development. In year of 2006, our country produced 7.28 million cars totally, being the third country whose production reached 7 million in the history of international auto industry. At the same time, the cars' sales reached 7.18 million totally, being the third automobile consumer in the world. Though our auto industry developed rapidly, the international competition of auto industry is weak. In the former 10 years before 2006, as one of the dominating industries in our national economy development, the auto industry kept an express growth both in production and sales. However, since 2004, the situation "increased production without income added" turned more and more serious in our domestic auto industry, and the profit is prone to decline year by year. The competitions among auto enterprises still focus on low cost and low price, lacking of innovation and brand. Under this background, this thesis will analyze the international competition of our national auto industry, and compare it with the developed countries* auto industry and bring forward some recommendations for our national auto industry.The core of industries' international competition lies in the ability the industry can supply the market with competitive products. Based on the Industrial International Competitiveness Theory of Michael Porter, this thesis will carry out a further exploration in the industry competition's connotations and characteristics theoretically, combined with the modern auto industry's situation, compare it with developed countries and Geely Holding Group's successful experience, have an objective appraise on our national auto industry's international competition.Finally, based on the above mentioned analysis, a suggestion will be put forward to strengthen our national auto's international competition from whole vehicle enterprises, component enterprises and industrial cluster. Mainly including: 1 st, fulfill an optimization of auto resources distribution, and realize industry optimization upgrade and reform; 2nd, summarize the relationship between whole vehicle enterprise and component enterprise with Chinese characteristics through learning developed countries' experiences; 3rd, build up powerful industrial cluster so that reach the real scale economy.