Since German Volkswagen accessed to Chinese market in building a joint venture\nin the mid-1980s, the automobile industry in China has been engaged in\nglobal value chain (GVC) activities for more than three decades. China went\nthrough three stages of start-up, large-scale expansion and overseas M&A,\nand very quickly established a comprehensive manufacturing system, remaining\nthe worldâ??s first place after 2009 in terms of output and sales. However, in\nline with the rapid expansion of production scale, automobile industry in\nChina, due to the lack of some value-added links in the global value chain of automobiles,\nhas failed to form a closed-loop reflux pattern in the GVC of automobile\nindustry, resulting in a significant segmentation phenomenon. It mainly\nmanifested in: 1) In the production process, there is the break between the\nupstream design and key parts against the mass local vehicle manufacturing,\nand the high-added value chain links are held by foreign operators. 2) In the\nsales process, there exists a fault zone between large-scale sales of vehicles and\nvery few export volumes. And the value chain of automobile industry in China\nhas not been effectively extended to overseas market. This paper further investigates\nmain reasons behind the segmentation of the automobile industry\nvalue chain in China: 1) the business strategy of multinational automobile\ncompanies aim to seize of Chinaâ??s local automobile market, which blocks the\noverseas extension of the value chain; 2) The control of domestic automobile\nsales channels by the foreign stake in JVs leads to the monopoly of supply\nchain and post-market of automobile industry, which indirectly leads to the\nsegmentation of value chain. 3) Low value acquisition mode of independent\nbrand automobile enterprises is isolated in the high value-added link of global\nvalue chain, which leads to the segmentation of value chain directly. 4) Some\nof the industrial and trade policies lead to the abnormal high price in automobile\nmarket and the difficulty of extending the overseas value chain. Furthermore,\nthis paper puts forward the research prospect of whether the value\nchain segmentation of automobile industry in China exists for a long time,\nand the alike problem of value chain segmentation. The new energy vehicles\nwill confront.
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