The Chinese government made a surprising announcement that it plans to eradicate the protectionist rules that stop foreign car makers from selling their cars in the country, opening its markets to the capitalist vehicle manufacturers from 2020.
Today’s rules state that to sell cars in China without big taxes, car makers need to establish joint venture companies with local firms and can’t own more than 50 percent of its Chinese partner. These measures were introduced by the Chinese government in 1994 trying to promote local companies and limit the already-rich Western auto companies that were seeking the potential of the huge Chinese market.
The restrictions will be removed this year for companies that sell electric vehicles in China because the government is trying to get under control the rapidly deteriorating air quality in the country encouraging take-up of eco-friendly vehicles.
