China to remove foreign ownership restrictions of auto JVs within five years

Shanghai (Gasgoo)- China will remove foreign ownership restrictions of auto JVs for specialty vehicles and NEVs in 2018, according to the official website of China's National Development and Reform Commission.

Besides, China will abolish foreign limits for commercial vehicle (CV) JVs in 2020. In 2022, the world's largest auto market will eliminate foreign ownership of passenger vehicle (PV) JVs and also remove the JV number limits of no more than two. With a five-year transition period, all the restrictions on foreign ownership of auto JVs will be entirely abolished.

Apart from auto industry, China will also remove the restrictions on shipbuilding industry, including designing, manufacturing and maintenance. The nation will also abolish foreign limits for the aircraft manufacturing industry in areas such as planes, helicopters and drones.

Tesla will build its wholly-owned plant in China in 2018, according to a report released on Apr. 13. In the wake of China's removal of ownership caps on NEVs, the American EV giant may accelerate its pace of establishing wholly-owned factories in China.

Cui Dongshu, secretary-general of the China Passenger Car Association believed that the removal of auto JV ownership caps will help develop China's auto technologies, adding that the phasing out of restrictions on JVs will be accelerated in an orderly manner. In the long run, China's removal of foreign limits for auto JVs will facilitate a fairer competitive auto market.