China is drawing up a new plan to become a leader in eco-friendly cars that could include forcing foreign automakers to share key technologies for access to its market, a report said yesterday.
The draft suggests China could force the technology transfers by requiring overseas firms enter into joint ventures in which they would be limited to a minority stake, the Wall Street Journal said.
It quoted unnamed executives of four foreign automakers who had seen the proposal, while noting that the plan was still only in the draft phase and that any such requirements could be eventually watered down or eliminated.
China is already facing growing complaints from foreign companies, business groups and governments that overseas enterprises are encountering an increasingly skewed playing field in the country’s huge market.
The auto technology requirement is “tantamount to China strong-arming foreign auto makers” to give up technology in exchange for market access, one senior foreign auto executive was quoted saying.
The report said the 10-year plan being prepared by the Chinese Ministry of Industry and Information Technology would make China “the world’s leader” in battery-powered cars and hybrids.
It aims to develop up to five Chinese companies into globally competitive makers of all-electric cars or plug-in hybrids by 2020, and up to three global suppliers of key components, the report said.
The plan calls for investment of as much as 100 billion yuan (US$15 billion), it said.
China’s auto market surged past the US to become the world’s largest last year. The plan is being distributed to other government agencies and some state-owned automakers for feedback, the report said. If major opposition does not surface, it could be implemented as soon as next month.
In July, the US Chamber of Commerce accused China of abusing the allure of its market to push foreign companies to transfer their latest technologies to Chinese competitors. It called the practice a “blueprint for technology theft on a scale the world has never seen before.”
Chinese Premier Wen Jiabao (溫家寶) on Monday promised China would keep the welcome mat out for foreign companies, following the complaints.
“China is committed to creating an open and fair environment for foreign-invested enterprises,” he said in a speech to the World Economic Forum’s “Summer Davos” meeting in Tianjin.
Meanwhile, Chinese battery and autos maker BYD Co (比亞迪) said it has agreed to buy an 18 percent stake in a Tibetan-based lithium and boron miner, moving to secure a strategically vital asset for its future growth.
BYD will pay 201.2 million yuan for its stake in Tibet Shigatse Zhabuye Lithium High-Tech Co (西藏扎布耶鋰業), with Tibet Jinhao Investment Co (西藏金浩投資) taking a 4 percent stake and BYD 18 percent, BYD said in a statement to the Hong Kong Stock Exchange.
Tibet Shigatse Zhabuye Lithium, based in Shigatse, Tibet, is a miner of lithium, boron and salts, it said. It has assets worth 431 million yuan, the statement said.
The acquisition is aimed at improving the competitiveness of BYD’s rechargeable battery business, it said.
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