China's Automobile Financial Service Industry Development Strategy Research

In recent years, China’s automobile industry developed very rapidly. Auto finance is of great importance in auto industry, not only because it can optimize the industry structure, shorten its cash cycle and improve sales but also because it can change consumption structure and promote national economic development.Despite the rapid development of China’s automotive finance, it still has a great room for improvement compared with foreign countries. China’s automotive finance still faces many practical problems, mainly in:automotive financial service institute has an unreasonable structure, single product, lack of personal credit system, immature credit model, as well as risk control loopholes.By comparing the status of domestic and foreign automotive finance, this paper focused on introducing the past experiences and analyzing the practical problems lying in financial instruments and risk management, finally, this paper gave specific recommendations according to the problems above.This paper suggested banks to strengthen it cooperation with auto companies in order to provide diverse services. Besides, it should also change the current loan-based approach and accelerate the development of other services such as finance lease, trust lease and car rent.The establishment of a nationwide network of personal credit is also suggested in this paper. At the mean time, auto finance institutions should also strengthen internal controls to reduce risk. Legal protection is also suggested in this paper.