“Made in China 2025” and the development of new energy vehicles production networks in China

Authors: Godfrey Yeung*, National University Of Singapore
Topics: Economic Geography, China, Regional Geography
Keywords: GPNs, extra-firm actors, new energy vehicles, China
Session Type: Paper
Day: 4/10/2018
Start / End Time: 4:40 PM / 6:20 PM
Room: Estherwood, Sheraton, 4th Floor
Presentation File: No File Uploaded

With the recurrent of dense smog in the capital and the reliance of imported technologies on combustion drivetrains, the policies on new energy vehicles (NEVs) could let Chinese government to “kill two birds with one stone”. This paper examines the roles and effects of government policies on the developmental trajectory of NEVs production networks and its potential implications for the development of automotive sectors in China. Under the “Made in China 2025” initiatives, Chinese government aims to establish the first mover advantages on NEVs in the world’s largest and most profitable auto market. The establishment of production networks on NEVs, from the development of locally financed NEV makers to the formation of new Sino-foreign joint-ventures on NEVs, is shaping by a combination of pollution control measures with “NEV credits” and the potential phrasing out of combustion powertrains, financial subsidiaries on R&D, and the (public and private) procurement of NEVs. Rapid but uncoordinated development on NEVs and the uncertain policy on conventional vehicles with combustion drivetrains have however lead to inefficient duplication of investment among automakers to disengagement of suppliers on combustion powertrains in the industry.

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