One after another, new passenger car projects in
Last year, three new car projects were launched. First, Jianghuai Automobile, one of the leading commercial vehicle manufacturers in China; then Great Wall Motor, a leading SUV and pickup truck maker; followed by Jiangling Automobile, another SUV manufacturer. All three felt much relieved after spending at least a year waiting and lobbying for an approval.
The regulatory guidelines for new passenger vehicle projects were specified in the Automotive Industry Development Policy (AIDP) released by the NDRC in 2004. The purpose was to raise the hurdle for new entrants into automobile assembly. Specifically the AIDP has laid out entry level requirements on the minimum investment amount, scale of production and the minimum R&D spending for any new project.
Such entry hurdles, however, seem unable to cool off the growing investment interest in
Two key departments under NDRC are directly involved in the approval process. One is the Department of Industry and the other the Department of Industrial Policy. Enterprises must submit supporting documents as proof of their qualifications to these two functionary departments. And final approval comes from NDRC directors.
Senior officials at NDRC seem to be caught in a dilemma. As the country¡¯s macro economic planning body, NDRC has the responsibility to prevent duplicate investments in, what senior officials in the organization believe to be, an overheated industry. Already
But on the other hand, NDRC finds it hard to disapprove a new project especially when the project meets the requirements set forth by it.
The result is a prolonged period of waiting on the part of the applicant. And the time taken to acquire the necessary approvals will largely depend on how good the lobbying efforts are, not only from a particular automotive enterprise but also from the active involvement of senior local municipal and provincial officials.
As more enterprises in